As Sensex, Nifty extend losses, here’s what the ‘near-term challenge’ is

The major draggers were with the Bajaj Twins Bajaj Finance Tanking over 8% after reporting a disappointing quarterly update for the third quarter (Q3FY23), financial indices have been pulling up.

“In India, the near term challenge for Share Market comes from continued selling by FIIs (foreign institutional investors) who sold 2620 crore equity in the cash market yesterday taking their selling spree to 9 consecutive days. FIIs are also net short in the derivatives segment. Banking segment data indicating continued credit growth and improving asset quality indicates good Q3 results. Investors can use the market weakness to buy high quality banking stocks,” said VK Vijayakumar, chief investment strategist, Geojit Financial Services.

Foreign Institutional Investors (FIIs) sold shares 2,620.89 crore on Wednesday, according to exchange data. According to analysts, benchmark indices gained in early deals as the Fed minutes were clear with the message that ‘accommunicative policy stance will need to be maintained until incoming data gives confidence that inflation will ease further’. There was a steady downward trend of 2 per cent. , who said there was caution across sectors in the market ahead of the earnings season.

“While it looks like inflation has peaked in 2022, central bankers are not letting their guard down. While the increase in policy rates has slowed, central bankers are now expected to keep rates high for a long time and the top rate may be slightly higher, versus earlier expectations. Equity markets which were up sharply in November, on hopes of a policy pivot, further consolidated some of their gains,” said Motilal Oswal, executive director – business and Investment strategy Prateek Agarwal said.

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