Market to remain indecisive this week

Market to remain indecisive this week

This week too, the domestic stock markets will continue to be influenced by global trade wars, volatility in global stock markets and crude oil price fluctuations. Thus combined with domestic factors such as the stress in the banking sector, direction of foreign fund flows and the rupee's movement against the US dollar, will also impact stock movements.

Technical charts showed a bearish outlook for the National Stock Exchange's (NSE) Nifty. The Nifty remains in downtrend and further downsides are likely early next week once the immediate supports of 9,952 points are broken. Immediate resistance is now at 10,227 points.

The key Indian equity indices – the BSE  Sensex and the NSE Nifty50 -- closed last week at 5-month low levels on the back of trade protectionist measures, apart from the ongoing turmoil in the domestic banking system as well as the uncertainty on the political situation in the country. The Sensex lost 579.46 points or 1.75 per cent to 32,596.54 points -- its lowest closing level since October 23, 2017. Similarly, the Nifty ended below the psychologically important 10,000-mark level and closed last week's trade at 9,998.05 points -- down 197.1 points or 1.93 per cent -- its lowest closing level since October 11, 2017.

The week is a short week with three trading sessions as Thursday and Friday are public holidays on account of Mahaveer Jayanti and Good Friday. Besides there is F & O expiry.

Investors will continue to keep close eye on further actions byDonald Trump and the reaction of the Chinese government. In addition, parliamentary proceedings, macro-economic points like Index of Eight Core Industries (ECI) figures, along with the country's fiscal deficit numbers up to February and its external debt data will be keenly watched by investors. 

The near-term outlook for the equity market remains unclear. While traders should remain cautious, the decline in good fundamental stocks would offer buying opportunities for long-term investors. Once the new financial year begins, people may take a fresh view on India. The markets may go through the pain for a few more sessions. Though markets are looking bad, corporate earnings are improving. Markets will ultimately determine which companies are doing well, which companies are expanding. This quarter when the results come out, the markets will make a decisive move.

Market movement to be led by global cues, volatility to persist

After a good previous weeks, stock markets failed to build on the momentum as indices erased all its gains to close almost unchanged. The possibility of four rate hikes this year in the US, rising crude oil prices and rising bond yields were among the major concerns that dragged the markets lower once again.

Even promising quarterly GDP numbers failed to cheer the sentiment on the street.The pace of economic growth in India is pretty much in line with expectations as captured by the latest GDP estimates. Indian economy extended the recovery during Q3, with GDP growing at 7.2% year-on-year (Y-o-Y), compared with 6.5% a quarter prior.Estimates project FY18 GDP will expand by 6.6%. While, core infrastructure sectors during January grew at a faster clip at 6.7% (Y-o-Y). India's fiscal deficit on the other hand, stood at Rs 6.77 lakh crore at the end of January, much above the target for the entire fiscal.

The previous week was a short week as markets were shut on Friday on account of Holi festival. The Sensex ended 137 points down or 0.40% at 34046.94, while the Nifty was down 34.50 points or 0.33% at 10458.40. The market breadth favoured the declines as 1163 shares advanced, against a decline of 1532 shares, while 207 shares were unchanged.In terms of stock movements, Coal India, IndusInd Bank, BPCL and AurobindoPharma were the top gainers among all indices, while ICICI Bank and SBI were the top losers.

Experts believe that volatility in Indian markets may continue for some more time due to both global events and domestic factors. The results of state elections in Tripura, Meghalaya and Nagaland with BJP set to come to power in Nagaland and Tripura should aid positive sentiment.

The automobile sector is expected to be in focus next week as the companies release sales figures for February 2018. Among other sectors, a rise in prices of steel post the release of strong economic data in China boosted buying in shares of metal companies.

As long as the market consolidates without such a breakdown, chances of a breakout will remain higher with a target of 10,900 levels. So how is the coming week expected to pan out for investors? Going by theweekly charts markets appears to be in a consolidation mode in the larger zone of 10630 – 10300 levels.

As long as the market consolidates without such a breakdown, chances of a breakout will remain higher with a target of 10,900 levels.

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