Stock Market News: The domestic benchmark indices, the Sensex and Nifty 50, started off Monday’s session on a positive note, led by financials following post-results gains in SBI Life Insurance and ICICI Bank.
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, states that the persistent selling by FIIs, which is brought on by the rising US bond rates, is still the main cause of the market’s negative sentiment. As long as US bond rates are high—a decision that is made by US inflation data—this selling by FIIs in both stock and debt will continue to have an impact on the markets.
Following a five-day surge, the Sensex and Nifty 50, buckled under selling pressure on Friday as investors reduced their exposure to banking, and financial stocks amid mixed global cues.
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According to reports, traders stated that continuing outflows of foreign funds, a falling rupee, and rising global crude prices further weighed on sentiments.
On Friday, the 30-share BSE Sensex closed at 73,730.16 level, down 609.28 points, or 0.82%. The NSE Nifty 50 ended at 22,419.95, down 150.40 points, or 0.67%.
Senior Vice President of Master Capital Services Ltd, Arvinder Singh Nanda said that the key domestic and global economic statistics will have an impact on the market’s trajectory. The Fed Interest Rate Decision, the China Manufacturing (PMI), the Euro Zone (CPI) (YoY), the India Federal Fiscal Deficit (Mar) and Infrastructure Output (YoY) (Mar), the Company Q4FY24 results, and the ISM Manufacturing Prices (Apr) will be in focus next week.
Market Outlook by Dharmesh Shah, Vice President, ICICI Securities
The buying demand from the lower band of the rising channel helped the index recover last week’s losses and settle the week above the 22,400 mark. In the process, broader market Nifty Midcap and Small Cap indices staged a strong rebound and clocked a fresh all-time high. The key point to highlight is that domestic institutional investors’ (DII’s) have shown strength by absorbing the foreign institutional investors (FII’s) sell-off seen during the month of April-24 while discounting a host of global volatility owing to geo-political concerns, said Dharmesh Shah.
“We believe Indian equities remain on a strong footing, which makes us reiterate our positive stance with the Nifty 50 target of 23,400 by the general election outcome with strong support at 21,700,” added Shah.
In the upcoming truncated week, Dharmesh Shah expects the Nifty 50 to challenge life highs of 22,800. The formation of a higher peak and trough signifies buying demand at an elevated support base that makes Shah revise immediate support upward at 22,100. Thus, any temporary breather should be utilised to accumulate quality stock in the ongoing Q4 earning season, explained Shah. His constructive bias is validated by the following observations:
A) Breadth continued to improve as the percentage of stocks above the 50-day EMA strengthened from 55% to 75%, highlighting broader market participation.
B) The India Vix (which gauges market sentiments) has plunged ~20% in the last week, suggesting receding market risk amongst market participants, which in turn bodes well for resolving the above ongoing…
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