Fed decision may act as major trigger for mkts

Diwali festivities continue in the marketplace even though Diwali is over. The period under review 27th October to 2nd November saw BSE Sensex post decent gains. Markets gained on the first four days of the week, while Wednesday one saw some profit taking. Sensex gained 1,363.13 points or 2.29 per cent to close at 60,906.09 points while Nifty gained 426.50 points or 2.42 per cent to close at 18,082.85 points.

Dow Jones continued to gain and was up on the first three days of the period under review. The last two days saw profit taking ahead of the Fed meeting which would announce its rate hike decision on Wednesday. While people believe it would be a steep hike, the extent of the hike being 50 basis points or 75 basis points is still being debated.

Dow gained 816.46 points or 2.56 per cent to close at 32,653.2 points.

The period under review began with expiry of October series on Thursday the 27th of October. October futures expired on a positive note and the series gained in the last week. The series ended with gains of 918.85 points or 5.46 per cent at 17,736.95 points.

In economic news, the GST collection for October 2022 was robust and touched Rs1,51,718 crores, which was the second highest monthly collection, since GST was introduced. While the number is impressive, it is also noteworthy that the monthly collections have started following a trend.

The first seven months average is Rs 1,49,243 crs which is not significantly different from the October level.

The primary markets are seeing a massive surge in issues to beat the deadline of results which are 135 days old. In simple terms this means that companies with audited June 2022 numbers have a short window.

So far two issues have opened, while another two would open on Thursday. Yet another three have shown their intent to open in the next three to four days.

The first of the lot was DCX Systems Limited. The issue was subscribed 76.23 times with QIB portion subscribed 95.02 times, HNI portion subscribed 46.20 times and Retail portion subscribed 64.87 times. In total, 18.32 lakh applications were received.

The second issue was Fusion Micro Finance Limited which opened for subscription on Wednesday. At the end of the first day, the issue was subscribed 0.14 times overall. The issues from Bikaji Foods International Limited and Global Health Limited would open for subscription from Thursday the 3rd of November and close on Monday the 7th of November.

The period under review from November 3rd to 9th would see a trading holiday on Tuesday, the 8th of November. This would lead to a break of momentum on Monday after just one day of trading. Markets have come to the first expected levels of 61,200 and 18,150, as expected last week. The highs made on Wednesday before the correction was at 61,209.75 points and 18,178.75 points.

Going forward, the immediate movement or direction of markets would come from the Fed meeting outcome. If the hike is digested by markets, there could be a sharp rally today itself. In case the hike does not go down well, we could see a correction for a day or two before the rally begins once again. The all-time highs on the benchmark indices are now about 3-4 per cent away from the current levels. While the possibility of them being hit is always there, it could take some more time before the event becomes a reality. Play for more upside in the markets in the short to medium term. Trade with positive mind frame. Aim for buying on meaningful dips. Avoid short trades.

(The author is the founder of

Kejriwal Research and Investment Services, an advisory firm)