The direction of the local market will be decided by global trends: Analyst
Analysts say that in the absence of any major developments at the domestic level this week, the stock markets will be largely determined by global trends. According to analysts, the business activities of foreign investors, global crude oil prices, and US…
New Delhi: Analysts say that in the absence of any major developments at the domestic level this week, the stock markets will be largely determined by global trends. According to analysts, the business activities of foreign investors, global crude oil prices, and the position of the rupee against the US dollar will also affect the movement of domestic stock markets.
“In the absence of clear global cues, market sentiment will likely depend on US bond yields, the dollar index, and crude oil prices as well as institutional investments in anticipation of consolidation,” said Santosh Meena, Head of Research, Swastika Investment Ltd. He said that the stability of the market may be affected till the assembly elections of five states are over and by that time a clear trend of the market may emerge. Since August, foreign portfolio investors (FPIs) have been withdrawing capital from Indian markets on a large scale.
VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, says that from August to November 15, FPIs have made a net sale of shares worth Rs 83,422 crore. However, during this period, domestic institutional investors (DIIs) purchased shares worth Rs 77,995 crore. Buying by individual investors along with DIIs completely neutralized the selling by FPIs. Vijayakumar said that it is the effect of buying by DII and individual investors that the National Stock Exchange (NSE) index Nifty is once again present at around 19,700 where it was at the beginning of August.
“Markets will focus on global and domestic macro-economic data, US bond yields, crude oil storages, investment trends of FIIs and DIIs, and movement of rupee against the dollar,” said Arvinder Singh Nanda, Senior Vice President, Master Capital Services Ltd. ” Last week, BSE’s benchmark index Sensex jumped 890.05 points or 1.37 percent, while Nifty rose 306.45 points or 1.57 percent.
Last week, except banking, all major sectors participated in this rally and registered strong gains. The broader indices continued their gains and the midcap index also hit its record high after two months. “Global cues are largely dictating the trend and we expect this trend to continue in the coming week,” said Ajit Mishra, senior vice president (technical research), of Religare Broking Ltd.