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Godrej Properties was the top performer of the week as its shares rallied from Rs 1,633.90 on September 17, 2021 to Rs 2,194.10 on September 24, 2021.

Global markets rallied as investors cheered the Federal Reserve’s latest signals on monetary policy, which suggested the central bank was warming to a near-term policy adjustment as the economy improved further. Domestic markets too rallied on positive factors like unlocking, strong growth in the real estate sector, good monsoon, positive developments in government policy, and investor’s confidence.

For the week ended on Friday, 24 September 2021, the Sensex skyrocketed 1,032 points or 1.75% to settle at 60,048. The Nifty 50 index rallied 268 points or 1.52% to settle at 17,853. Both the indices attained record closing levels. The BSE Mid-Cap index advanced 148 points or 0.59% to settle at 25,194. While the BSE Small-Cap index gained 16 points or 0.06% to end at 28,023.

The Nifty Realty index gained the most as the developers reported that buying remains sustained ahead of the festive season and after a reduction in interest rates by several banks on home loans.

“Nifty closed higher for the fifth consecutive week, closing 1.52% higher for the week. For the week, Realty, Media and IT indices rose the most, while PSU Banks, Metals and Pharma indices fell the most. Advance decline ratio for Sept 24 however fell deeply into the negative, suggesting nervousness among the market participants about the broader market,” said Deepak Jasani, Head of Retail Research at HDFC Securities.

Top gainers

Despite the broader markets, underperforming benchmark indices around 204 or 40.8% constituents of the BSE 500 index ended the week with positive returns. With a gain of 34.29% Godrej Properties was the top performer of the week as its shares rallied from Rs 1,633.90 on September 17, 2021 to Rs 2,194.10 on September 24, 2021. This came on the back of the company reported that had sold 340 homes with an area of more than half a million square feet on the first day of launch making this one of the most successful launches in India in recent times.

Oberoi Realty (up 25.78%), Zee Entertainment Enterprises (up 24.89%), DLF (up 22.71%), Gujarat Alkalies And Chemicals (up 22.51%), Gujarat Narmada Valley Fertilizers & Chemicals (up 21.25%), Chalet Hotels (up 20.42%) and The Indian Hotels Company (up 20.03%) were the other stocks that rallied over 20% the week.

Outlook

Trading could be volatile in the forthcoming week as traders roll over positions in the F&O segment from the near month September series to October series. The September 2021 F&O contracts will expire on Thursday, 30 September 2021. Trends in global markets, the progress of monsoon, the movement of rupee against the dollar and crude oil prices, investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) will also be watched.

On the macro front, the Infrastructure Output data for August will be released on 30 September 2021. Markit Manufacturing PMI for September will be declared on 1 October 2021. Auto stocks will be in focus as auto companies will start announcing monthly sales numbers for September starting from 1 October 2021.

Overseas, China will announce the NBS Manufacturing PMI for September on 30 September 2021. China will announce the Caixin Manufacturing PMI for September on the same day. US Durable Goods Orders for August will be declared on September 27.

“Valuations have reached stratospheric levels especially for a lot of the desired high-quality names across sectors. Thus bottom-up stock picking approach is becoming difficult for investors. Traders should have a cautious approach as intermittent volatility cannot be ignored given such rich valuations. However, we expect the positive momentum to continue on the back of the recovery in corporate earnings,” said Siddhartha Khemka, Head – Retail Research at Motilal Oswal Financial Services.