On March 18, the 30-stock Sensex and the broader Nifty continued their downward trend for a second consecutive day, influenced by a blend of global cues. Analysts anticipate a prevailing pessimistic outlook in the coming days as investors grapple with apprehensions regarding inflated valuations in mid and smallcap sectors.
The Sensex hovered around 72,678 while the Nifty maintained levels near 22,012, exhibiting a flat-to-negative trajectory. Market dynamics showcased 1,891 shares making gains, 833 witnessing declines, and 143 remaining unchanged.
Sameet Chavan, who holds the position of Head of Research in Technical and Derivatives at Angel One, emphasized the importance of a cautious investment strategy. In light of prevailing market conditions, he recommended investors to exercise patience and refrain from engaging in aggressive long positions. Chavan suggested waiting for clear bullish signals to emerge before considering any significant moves in the market.
“Should the indices dip below the 21,850-21,900 range, we could witness another wave of substantial selling, potentially driving prices back towards the previous low of 21,500,” remarked Sameet Chavan, Head of Research in Technical and Derivatives at Angel One.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, anticipated a week marked by high volatility in the markets. “Several factors, including the outcome of the Fed meeting on March 20, the surge in the US 10-year bond yield to 4.3 percent, and potential SEBI directives stemming from stress tests in mid and small cap schemes, are poised to influence the market in the short term,” he noted.
In the early trading hours, broader markets sustained losses, with the Nifty Midcap 100 and Nifty Smallcap 100 indices sliding by up to 0.5 percent. The India VIX fear gauge surged over 6 percent, hovering around the 14 level.
Expressing concerns over the inflated valuations in mid and small caps, Vijayakumar suggested investors adopt a cautious approach. He recommended considering purchases in large caps within sectors such as capital goods, banking, telecom, and automobiles during market dips.
In sectoral movements, Nifty Realty emerged as the top loser, sliding by 0.9 percent, while Nifty Media defied the trend, recording nearly a one percent gain.
On the global front, US stock futures displayed marginal gains overnight as investors awaited the Federal Reserve’s interest rate decision scheduled for March 20.
The CME FedWatch tool indicates that approximately 99 percent of market participants expect the global central bank to maintain interest rates at the current range of 5.25-5.5 percent. However, attention will be focused on economic projections and potential timing for rate cuts.
Overnight, Dow Futures, tech-heavy NASDAQ Futures, and S&P 500 Futures posted gains of up to 0.2 percent.
In the Asia-Pacific region, markets mostly trended lower this morning in anticipation of the Bank of Japan’s monetary policy decision. Japan’s Nikkei 225 index surged over 2 percent, while Australia’s S&P 200 declined by 2 percent, and Hong Kong’s Hang Seng dropped by 0.5 percent.
Sources: moneycontrol.com
Disclaimer: The opinions and investment insights provided are intended solely for informational purposes and should not be construed as financial advice. Bystox.in strongly advises users to consult certified financial experts or professionals before making any investment decisions. We emphasize the importance of conducting thorough research and seeking personalized guidance tailored to individual financial goals and circumstances. Please be aware that investing involves inherent risks, and past performance is not indicative of future results. Bystox.in does not assume any responsibility or liability for the accuracy, completeness, or reliability of the information provided. Users are encouraged to exercise caution and diligence in their investment endeavors. Remember, your financial well-being is paramount, and seeking expert advice is highly recommended.