NEW DELHI: With no major domestic event lined up for this week, India’s equity market will most likely be shaped by global factors, analysts said, adding that they expect benchmark indices to remain range bound in the near future.
Last week, Indian markets broke their four-week gaining streak as global markets were surprised by the US Federal Reserve’s signal of a rate hike by early next year. That impacted investor sentiments worldwide and resulted in the dollar index jumping to a two-month high. The Sensex fell 130.31 points to 52,344.45, and Nifty50 declined 116 points to 15,683.35 during the week.
“Markets are likely to spend some more time in a range and we expect volatility to remain high due to the scheduled derivatives expiry of June month contracts. With no major event, participants will be closely eyeing the global markets for cues. Besides, the progress of monsoon and updates on the vaccination drive will also be in focus,” said Ajit Mishra, VP Research, Religare Broking.
Motilal Oswal Financial Services in a note said that domestic market may consolidate for some time before resuming its rally. “Technically too, the trend remains intact for an up move towards 16,000-mark. Globally, investors would cautiously track what action other central banks take following Fed’s hawkish announcement,” it said.
Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities, said, “Going forward, Indian Markets would keep an eye on US economic recovery and signals from the Fed, global commodity prices, new Covid cases and the pace of vaccination in India, unlock measures by various states, GST collections, monsoon development Pan India, and consistency of reforms from the Central Government.”
He added, that the 15400/51800 (Nifty/Sensex) should be the sacrosanct level for the bulls, and as long as its trading above the same, the uptrend is likely to continue up to 15800-15900/52600-52850 levels. “Further upside may also continue which could lift the index till 16050-16130/ 53100-53300. On the flip side, below 15400/51800, uptrend would be vulnerable,” he said.
- US Fed’s hawkish signalling with regard to rates last week saw Indian markets breaking 4-week gaining streak
- Going forward, Indian markets are likely to continue to take cues from the actions of other countries’ central banks this week