Week Ahead

The BSE Sensex plunged 1,830 points or 2.70 percent to 66,009, while the Nifty50 tanked 518 points or 2.57 percent, the biggest weekly loss since February (in percentage terms), to 19,674.

The correction was also seen in broader markets, as the Nifty Midcap 100 and Smallcap 100 indices fell 1.7 percent and 2.5 percent.

The hawkish tone of the Federal Reserve hinting higher rates next year, aggressive sell-off by foreign institutions, correction in index heavyweights like HDFC Bank, and weak global cues dented the market sentiment.

After severe correction, the market is likely to consolidate further with negative bias in the coming week with focus mostly on global cues due to absence of major domestic data points and the scheduled monthly expiry of September derivative contracts may also cause volatility.

Technically Nifty50 has decisively broken its crucial support of around 19,850-19,900 levels and closed at 19,674 for the last week. The next critical support is likely to be 19,500-19,400 area, followed by 19,200 but in case of recovery, the index may face resistance at 19,800-20,000 levels in coming week.