India Stocks Outlook: To take cues from oil, overseas mkt next wk

[B. Karthick]

India Stocks Outlook: To take cues from oil, overseas mkt next wk
Saturday, Aug 16

Key share indices are seen taking cues from movement in crude oil
price and overseas markets next week.
However, sentiment is likely to take a hit as inflation for the
week to Aug 2, detailed after market hours Thursday, stood at 12.44%
Vs 12.01% a week ago.
Sensex ended at 14724.18, down 368.94 points or 2.4%.
Nifty closed at 4430.70, down 98.35 points or 2.2%.
India VIX or volatility index rose 1.4%.
Market looks like it is in a corrective mode, plus with crude oil
prices rising again, we may see 14500 on Sensex.
However, the market might bounce back from that level on Sensex
due to value buying.
We feel 500 points decline in the coming week in Sensex and
150-200 points in Nifty. Banking has already slid down. There has been
a strong correction in real estate. We do not see much of downside
next week (in these sectors), hardly around 10%.
Banks may bounce back on value buying, especially ICICI Bank,
State Bank of India, and HDFC Bank on dips.
Auto shares are likely to see some more weakness on account of
high interest rates and lack of specific triggers for the sector.
The auto sector has neither fallen very sharply nor risen in the
same fashion. So unless there are stocks available at extremely low
levels.
We expect buying frontline stocks like Reliance Industries, Tata
Steel, and L&T on declines.
We may see a correction initially because Nifty closed below an
important level of 4450. It now has support at 4400 and below that
4350. Around 4350, we may see value buying coming in.
Closing above 4450, Nifty may inch higher towards 4650, which will
serve as a major resistance. Breaching 4650, Nifty can touch 4750,
which can be utilised to offload weak positions. End

B.Karthick
Research Analyst.