Indian markets remained flat for the week and continued their consolidation with sector rotation being the only theme at current levels and under-performing regional markets, said Jaykrishna Gandhi, Head, Business Development, Institutional Equities, Emkay Global Financial Services.
Infosys drove the IT space lower as it materially reduced guidance and put a cap on the overall rally in IT, he said.
US markets continued to rally going into the Fed meeting tonight, wherein it is expected that post the 25bps hike the fed will stop putting and end to a record pace of rate hikes. Last inflation print of 3 per cent also would drive the pause in rate hikes.
Within India, results season is in full steam with Autos materially beating estimates on easing RM prices.
Banks results have been in line with expectations as margin compression has been the theme. Thus far the results season has been better than expected in terms of earning outlook and management commentary, he said.
China recently promised a strong stimulus to support the ailing economy and the market has rallied 6 per cent on back of this news. It remains to be seen with regard to the quantum of the stimulus as well as the impact of the same. But China recovery could hold the key for revival in global growth but would also drive commodity prices higher, he added
Nifty closed in positive territory led by buying in select heavyweights, says Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
The index closed with gains of 93 points at 19,774 levels. Broader markets too followed suit and witnessed buying interest.
All sectors ended in the green, except for consumer durables. FMCG, PSU bank, realty, and oil & gas were top gainers, he said.
After three days of consolidation, the market is witnessing buying at lower levels. Further, a lower VIX is also supporting the bullish sentiments, he added.
Now all eyes will be on the US FOMC meeting, where another rate increase is expected. Fed's commentary will also be important, as this would provide some cues towards the Fed's stance going forward. Domestically, monthly FNO expiry along with a slew of corporate earnings, could keep the market a bit volatile, he said.
Vinod Nair, Head of Research at Geojit Financial Services said optimism has inched back today after the last three trading days of consolidation ahead of the FOMC meeting.
As the market's ambiguity against the monetary policy is likely to reverse henceforth, going forward we are unlikely to see another Fed rate hike in 2023.
This is because inflation has rapidly come down and is forecast to settle down further. However, the interest rate is expected to stay high in the short-term since the rigidity of core inflation remains above the long-term average, he said.