Domestic markets are anticipated to open with negative predisposition on Wednesday. The snake-and-ladder video game is most likely to continue at the bourses, in the middle of blended international hints. Gifty Nifty at 19,354 signals a gap-down opening of about 50 points for Nifty
Asia-Pacific stocks are flat however mostly positive in early deal on Wednesday regardless of a blended end in the United States markets over night.
Vikas Jain, Senior Research Analyst at Reliance Securities, said: The sell-off in United States federal government financial obligation continued to strike the world’s biggest bond market, with yields on standard Treasuries striking brand-new 16-year highs. The yield on the 10-year note increased as much as 0.1 portion indicate 4.35 percent, exceeding a previous high in October and sending it to the greatest level because November 2007.
According to Vinod Nair, Geojit Financial Services, the impact of greater bond yields and issues about possible rate walkings in the United States is triggering FIIs to withdraw funds from the domestic market, adding to the marketplace’s volatility.“
Amnish Aggarwal – Head of Research, Prabhudas Lilladher Pvt Ltd, said: NIFTY has given more than 14% return in FY24 YTD as India attracted more than $16.5 billion of net FII flows. India seems well poised for growth in longer term, however coming months will be a real test for the economy and markets given EL Nino impact on crops and Inflation as food inflation has spiked to more than 7.4 per cent and rainfall outlook remains subdued; and dim possibility of further cut in interest rates with some possibility of an increase in second=half.
“We expect markets to start factoring in political risks as election related activity picks -up with state elections in November and Lok Sabha elections in April 2024. Economy is getting a big push from Union Govt induced capex even as rural India is showing faint signs of recovery and urban discretionary demand remains tepid. Expected interest rate hike in US and its impact on INR/USD with impending political and inflation risk can impact capital flows,” he said and including that high inflation can be a political hot potato in an election year, requiring govt to decrease capex.
“We remain positive on Auto, Banks, Capital Goods and Healthcare. We cut NIFTY target to 20,735 given cut in earnings (impact of floods and late Diwali in 2Q) and expect markets to consolidate ahead of 2024 elections. We advise stock specific approach and avoiding sectors / companies with weak fundamentals and lack of business moats,” he even more said.
