Indian Sector Reports - RupeeDesk: Weekly Indian Sector Outlook -17.10.2016

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Indian Market Outlook for the week – 17 to 21.10.2016

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Domestic stock indices are seen consolidating next week because investors will be cautious

ahead of corporate earnings for the September quarter. Among heavyweights, Infosys and

Tata Consultancy Services have disappointed with their Jul-Sep earnings result so far.

Next week, index majors Reliance Industries, YES Bank, HCL Technologies, Wipro, and

UltraTech Cement will report their earnings for quarter ended September.

Indices are also seen consolidating due to concerns over stock valuations and dwindling fund

inflows in the market. Global volatility ahead of upcoming US presidential elections,

prospects of the Federal Reserve hiking interest rates, challenges pertaining to Brexit, and

prevailing tensions between India and Pakistan will also keep investors guarded.

Next week, the Nifty 50 is likely to find support at the 8540-point mark, and no major

downside is expected. Gains are likely to be capped at 8730 points. Yesterday, the 51-stock

index ended at 8583.40, up 10.05 points or 0.1% from the previous close, while the Sensex

ended at 27673.60, up 30.49 points or 0.1%.

We expect mid-caps to continue their rise as the broad market remains fundamentally

strong. Any fall in mid-caps is nothing but an opportunity to buying. Stocks in the

information technology sector will remain subdued because Infosys cut its sales guidance for

2016-17 (Apr-Mar), and also as earnings of other peers in the sector are seen disappointing

the market.

However, expect stocks of HCL Technologies and Tata Consultancy Services to outperform

those of Wipro and Infosys. HCL Technologies, Wipro, and Mindtree will report their earnings

for the September quarter on Friday.

The Nifty IT index is seen remaining flat to marginally negative next week, with stock

specific value buying opportunities seen emerging from a medium-to-long-term perspective.

Market participants expect companies in the pharmaceutical and cement sectors to

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