India’s benchmark closed by 1% in the holiday-shortened Diwali week. After a good start to the new Samvat 2079 on Muhurat trading day (October 24), markets were buoyed by monthly F&O expiry, improving US GDP data. BOJ maintains a policy balance at -0.1%, ECB, decent yields and FII.

For the week, the BSE Sensex gained 652.7 points, or 1.10%, to settle at 59,959.85, while the Nifty50 gained 210.5 points, or 1.19%, to settle at 17,786.8.

In terms of sectors, the Nifty PSU Banking Index was up 5%, the Nifty Motors Index was up 4%, and the Nifty Oil & Gas Index was up 3.2%. On the other hand, the Nifty FMCG index fell 0.7%.

For the week, the BSE Smallcap index rose 0.4%, while the Midcap and Largecap indexes each added 1%.
“For some time now, fears of aggressive Fed rate hikes appear to be fading, as a falling US dollar index, lower US Treasury yields, and moderate crude oil prices are key positive catalysts for investors.

“Technically, Nifty has been facing resistance between 17,800-17,850. Also, the index has been finding support around 17,600.

“On the weekly chart, Nifty has formed a hammer candlestick pattern, indicating indecision between bulls and bears. In the near term, 17,800 will act as a key resistance level for traders, above which the index could rally to 18,000-18,100.

“On the other hand, if it falls below 17,600, selling pressure could increase, and a retest of the 50-day SMA (simple moving average) or 17,500 is possible. Further declines could drag the index towards 17,400.”

This week, FIIs bought shares worth Rs 3,986.25 crore, while domestic institutional investors (DIIs) sold shares worth Rs 1,240.47 crore. However, in October, FIIs sold shares worth Rs 4,667.67 crore, while DIIs bought shares worth Rs 10,384.07 crore.

BSE Small Cap Index rose 0.4%, followed by gains of 15-31%: D-Link India, Infibeam Avenues, Transformers and Rectifiers India, Bharat Bijlee, South Indian Bank, Muthoot Capital Services, J Kumar Infraprojects, Sasken Technologies, Rama Steel Tubes, Indian Tourism Finance Corporation, Dhani Services, HPL Electric & Power, IIFL Finance and Ramky Infrastructure.

The following stocks increased by 7-13%: Sharda Cropchem, Bombay Dyeing, Rajratan Global Wire, KPI Green Energy, Thirumalai Chemicals, CarTrade Tech, Prince Pipes & Fittings, Cantabil Retail India, Monarch Networth Capital, SUMITOMO CHEMICAL INDIA, Apcotex Industries, DCM Nouvelle, Ruby Mills and Metro Brands.

The BSE 500 rose 1%, supported by Infibeam Avenues, Tata Motors-DVR, Bank of India, IIFL Finance, Indian Multi-Commodity Exchange, SJVN, Latent View Analytics, Bharat Heavy Electricals, Rail Vikas Nigam and Indraprastha Gas.

“Domestic markets were flat this week with a positive bias as favourable local cues mixed with the global sentiment. US GDP grew 2.6% in the second quarter. However, it failed to lift the market as US tech stocks tumbled. Disappointing quarterly results and bleak forecasts followed a sharp sell-off,” said Vinod Nair, head of research at Geojit Financial Services.

“The ECB raised interest rates by 75 bps, also showing that it is progressing in tackling record inflation, despite the increased likelihood of a recession. The central bank is expected to slow the pace of rate hikes from early Global markets brought comfort. “As a result, global bond yields have softened, with US 10-year yields falling below 4%. A stronger rupee, weaker US Treasury yields and a good second quarter will support the domestic market soon.”