Previous Week : Sensex on a weekly basis ended down by 697.96 points
Indian equity benchmarks closed with over 4% cuts spooked by fears of a stuttering recovery in the European and US economies after the debt crisis, which led to a global sell-off. Nifty closed in red in three out of the four trading days in last week trade. Sell off in the market intensified in the second half of the week as the index continued to glide down under relentless selling pressure across sectors largely led by Rate sensitive and Technology pack.
  • The Sensex on a weekly basis ended down by 697.96 points or -4.2%, to close at 16141.67 levels whereas the Nifty ended down by 227.30 points, or -4.5%, to close at 4845.65 levels
  • IT and Banking stocks were the major draggers in the index during last week trade where as only Hero MotoCorp managed to close the week with a gain of 5.5%
  • Market breadth throughout the weak remained extremely weak as Midcap stocks came under heavy selling pressure
  • India's food inflation for the week ended August 6 declined to 9.09% on a week-on-week basis from 9.9% for the week ended July 30 while the fuel price index increased to13.13% (12.19% last week)
  • July WPI stood at 9.22% against consensus estimates of 9.24%. May WPI revised to 9.56% from 9.06%
  • Nymex crude declined 5.4% on a weekly basis to close at $81 /barrel (on Thursday) on weak global concerns
  • The week also witnessed some weak economic data from the US
  • The data from National Association of Realtors showed that existing home sales fell by 3.5% to an annual rate of 4.67 million in July from 4.84 million in June
  • The Philly Fed's diffusion index of current activity fell to a negative 30.7 in August from a positive 3.2 in July, with a negative reading signifying a retrenchment in activity
  • On the economic front, the Labour Department said its producer price index rose by 0.2% in July following a 0.4% decrease in June. Industrial production rose by 0.9% in July, exceeding economist estimates for a 0.5% increase

Week Ahead : Pullback towards 5000-5050 levels is likely to meet with fresh selling pressure
Fresh waves of selling kept the Bulls at bay as key Indian equity benchmarks extended the down trend for fourth week in a row. Sensex and Nifty made new 16 month lows as they slipped below 16000 and 4800 levels for first time since May 2010 on intra day basis.
  • Nifty began the week on a bear note as it reacted sharply from 5200 mark on Monday and collapsed to sub-4800 levels by Friday before closing off weekly lows
  • While short and medium term trend is clearly bearish, markets have approached the key technical supports around 4800 mark (May 2010 lows) and some supportive action from these levels can not be ruled out owing to oversold condition of the indices
  • However any pullback towards 5000-5050 levels is likely to meet with fresh selling pressure
  • On the flip side, decisive breach of 4800 levels would open downsides towards next support zone of 4650-4600 levels in the coming week
  • In the month of August till date (August 18) FIIs have sold shares worth 8055 crores while DII were net buyers to the tune of 6297 crores
  • Key data to watch globally would be US new home sales, US MBA mortgage applications, US durable goods orders, US GDP
  • In India the key data to watch next week would be weekly inflation