Week Ahead

The BSE Sensex dropped nearly 400 points to 65,323, and the Nifty50 declined 89 points to 19,428, dented by banking & financial services, and FMCG stocks, but the buying in technology, metal, oil & gas, pharma, and select auto stocks capped downtrend.

Going into the next week, the market on Monday will first react to industrial production numbers for June, while overall, the consolidation is expected to continue with a focus on monthly CPI and WPI inflation numbers, and FOMC minutes.

In the absence of any major trigger and uncertain global cues, we expect the market to consolidate in the range.

Definitely there is a sign of weakness in the index for the short term and index could extend its correction but we believe that the downside in the market would be limited.

Technically Nifty50 has formed bearish candlestick pattern with minor upper shadow on the weekly scale, making lower highs for third straight week, but broadly traded within previous week's range. The Nifty50 has taken a support at upward sloping support trendline on closing basis, which is crucial to watch next week. After breaking of the same, the index can find support at 19,300-19,000, followed by 18,850-18,900 area, whereas on the higher side, 19,650-19,700 is expected to be critical hurdle.