- The short — five-line brief
- Sector rotation map
- Flows & positioning
- Risk controls & exit rules
- Indicative calendar
The short
- Leadership: Banks, capital goods; orderbooks + asset quality still drive relative strength.
- Improving: Autos, pharma, power broaden participation; watch inventory and US pricing pressure.
- Cooling: IT midcaps on lumpy deal ramps; stick to cost-takeout leaders.
- Microcaps: Avoid low-float euphoria near events; size by liquidity.
- Macro: FX-range and mid-60s crude imply stable retail fuel bands into early week (directional).
Rotation map (illustrative)
| Sector | Status | Driver | Risk flag | Positioning cue |
|---|---|---|---|---|
| Banks | Leader | Credit growth, asset quality | Deposit beta creep | Favor OCF/EBITDA > 0.8; lower wholesale mix |
| Capital Goods | Leader | Backlogs, execution | Input costs | Diverse orderbooks; avoid single-client risk |
| Autos | Improving | Festive channel builds | Inventory > 6 weeks | Trim on sustained discounting |
| Pharma | Improving | US launches + India mix | US price erosion | Prefer steady gross margins + ANDA pipeline |
| IT | Cooling | Delayed ramps | US macro scare | Stick to deal/TCO proof; avoid premium without TCV |
| Power | Improving | Demand + tariff clarity | Fuel linkages | Blend regulated + merchant exposures |
Flows & positioning
- Domestic: Systematic savings continue to cushion dips; breadth favors quality balance sheets.
- Foreign: Selective participation in financials/infra; sentiment sensitive to global prints.
- SME: Oversub remains high but day-2 quality tracks float and market-maker design—avoid crowded names.
Risk controls & exit rules
Stops & trims
- Leader underperforms Nifty by 5–7% over 4 weeks or net revisions turn negative → trim.
- Two failed breakouts with rising supply → step down position size by 25–40%.
Liquidity & leverage
- Avoid high-beta microcaps into events; size by ADTV × 10 rule of thumb.
- Financed HNI flows: monitor unwind pressure around T+1/T+2.
Indicative calendar (Oct 13–17)
- Mon–Tue: Earnings cluster kicks off in banks/cap goods; watch order-to-revenue conversion commentary.
- Mid-week: Periodic retail fuel/ATF check-ins; INR and crude still the big dials.
- Thu–Fri: Price-band and allotment updates often drop late afternoon; manage gap risk for smallcaps.