Value Plus

Arihant's Value Plus - January 2018

Market Outlook 2018: With the formation of stable government in 19 states and a blockbuster year 2017 behind us, we believe that the positive trend in Indian stocks is likely to continue in 2018, albeit with series of profit taking. As the polices unveiled by the government will take time to shape the real economy, we expect economic activity in India is likely to pick up after five straight quarters of slowdown as the adverse impact of the Goods and Services Tax and demonetisation fades. Corporate earnings are likely to increase further in second half, both on account of speedy approvals and an improving economy.

2018 will be a crucial year in India’s path to economic development and good governance. We expect the government to implement several reforms in fiscal and investment area, setting the stage for next leg of inclusive and sustainable economic growth for the forthcoming years.

All eyes will now be glued on the reforms to be unveiled in Union budget in February and Reserve Bank of India (RBI’s) action on interest rates. The biggest risks in 2018 could emerge from a reversal in crude oil prices and with higher interest rates in the US, which could lead to fund outflows from emerging markets. Such global risk aversion-driven corrections can be seen as good accumulation opportunities.

In this issue:

  • Movers & Shakers
  • Market Outlook
  • Technical Outlook
  • Financial Themes in 2018
  • Stock Picks for 2018
  • Commodity Outlook
  • Currency Outlook
  • Mutual Fund

Technical Outlook 2018: Markets witnessed spectacular rally in the year 2017 and has formed a strong bull candle. This suggests that momentum on the upside is likely to continue. On the sectoral front Consumer durable, Real estate led the rally whereas Pharma, Utilities ended on the losing side. The Sensex gained 27.28% whereas Nifty gained 28.04% till date.

In current year of 2018 Nifty has resistance at 11493 – 12086 – 13100 levels whereas on the downside, 9507 – 8914 – 7900 levels. In coming year if Nifty trades above 10864 then it is likely to test 11493 – 12086 – 13100 levels. However, if Nifty trades below 10136 then it is likely to test 9507 – 8914 – 7900 levels.

Broadly, we are of the opinion that the yearly trend is up and as long as Nifty holds 8914 level for current year there is high probability that Nifty may test 11493 – 12086 – 13100 levels.

Tags: Technical StocksMutual FundMovers & ShakersCommodity OutlookMarket OutlookCurrency OutlookStock PicksNifty Technical OutlookFinancial Themes

Arihant's January Investment Newsletter is now available #‎ValuePlus. 
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DISCLAIMER: This document has been prepared by Arihant Capital Markets Limited (hereinafter called as Arihant) and its subsidiaries and associated companies. This document does not constitute an offer or solicitation for the purchase and sale of any financial instrument by Arihant. This document has been prepared and issued on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst meticulous care has been taken to ensure that the facts stated are accurate and opinions given are fair and reasonable, neither the analyst nor any employee of our company is in any way is responsible for its contents and nor is its accuracy or completeness guaranteed. This document is prepared for assistance only and is not intended to be and must not alone be taken as the basis for an investment decision. All recipients of this material should before dealing and or transacting in any of the products referred to in this material make their own investigation, seek appropriate professional advice. The investments discussed in this material may not be suitable for all investors. The recipient alone shall be fully responsible/are liable for any decision taken on the basis of this material. Arihant Capital Markets Ltd (including its affiliates) or its officers, directors, personnel and employees, including persons involved in the preparation or issuance of this material may; (a) from time to time, have positions in, and buy or sell or (b) be engaged in any other transaction and earn brokerage or other compensation in the financial instruments/products discussed herein or act as advisor or lender/borrower in respect of such securities/financial instruments/products or have other potential conflict of interest with respect to any recommendation and related information and opinions.