Is there an investment opportunity in PSP Projects shares?

In the week ended August 20, both Sensex and Nifty touched their fresh record highs of 56,118 and 16,701, respectively. However, benchmark indices retreated from their record highs during the week on Fed’s taper talk and fears of the delta variant of coronavirus. Sensex and Nifty gave up 2-week winning streak to end the week marginally lower. Sensex fell 107 points or 0.19% to settle at 55,329. The Nifty 50 index lost 78 points or 0.48% to settle at 16,450. But the sell-off in the broader markets was much severe as the BSE Mid-Cap index shed 261 or 1.14% to settle at 22,679 while the BSE Small-Cap index declined 597 points or 2.27% to settle at 25,758.

“Nifty snapped a two-week winning streak and ended lower by 0.48%. In the process, it formed a doji like a pattern on weekly charts suggesting indecision at higher levels. Over the week, FMCG and IT were the main gainers while Metals, Media, PSU Bank and Realty lost the most. Global worries (Fed withdrawing stimulus, Delta Variant spread, Slowing global growth and China’s regulatory tightening) are impacting sentiments of investors in India. The broader market rally seems to be fizzling out,” said Deepak Jasani, Head of Retail Research, at HDFC Securities.

Top gainers

Regardless of weak performance in the broader markets around 113 stocks or 22.6% constituents of the BSE 500 index ended the week with positive returns. With a gain of 17.11% Adani Total Gas was the top performer of the week as its shares rallied from Rs 909 on August 13, 2021 to Rs 1,065 on August 20, 2021. Fortis Healthcare (up 17.10%), Apollo Hospitals Enterprise (up 17.01%), Adani Transmission (up 16.34%), Aster DM Healthcare (up 15.74%) and Mindtree (up 14.54%) were the other stocks that rallied almost 15% 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 August series to the September series. Market participants will track trends in global stock markets, the progress of the monsoon, the movement of the rupee against the dollar and crude oil prices will dictate the trend on the bourses in the near term. Investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) will be watched.

“For the coming week, the cluster of supports at 16,350 – 16,250 – 16,150 are to be observed closely. As of now there is no indication of Nifty sliding below the lower range of this support zone. But you never know how global developments pan out. On the flipside, the real strength in Nifty is possible only after convincingly surpassing the band of 16,500 – 16,600. Also, the Bank Nifty and the Nifty Midcap are trading at make or break levels. Since the coming week is monthly expiry week, it would be interesting to see how things unfold. Traders are advised to remain light for a while and the ideal strategy would be to look at the individual stocks than the benchmark index,” said Sameet Chavan of Angel Broking.