The Nifty soared to an unprecedented high post the RBI Governor's monetary policy announcement, surpassing the 21,000 milestone, as noted by Rupak De, Senior Technical Analyst at LKP Securities.
As anticipated, the RBI Governor's decision to maintain key lending rates at 6.50 percent was already factored into market expectations. The upward revision of the real GDP growth projection for 2023-24 is expected to instill positive sentiment in the market.
In the immediate term, volatility could mark the Nifty's trajectory, with a definitive breakout above 21,000 potentially propelling the index towards the 21,550-21,700 range. Rupak De identified a critical support level at 20,800.
V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, foresees a near-term market trajectory that may involve consolidation around current levels before a subsequent phase of the rally commences.
Economic indicators signal a robust economy capable of sustaining earnings growth into FY 25. Key indicators such as power demand, housing demand, credit growth, and the revival of rural demand underscore the resilience of the economy, albeit restrained by valuation concerns.
Vijayakumar recommended accumulating fairly valued segments like banking during market dips. Moreover, the decrease in crude prices presents a positive outlook for sectors like paints, tyres, and aviation, where demand remains robust despite market fluctuations.
(With Agency Inputs)