Major benchmark indices reclaimed last week’s losses and broke a 4-week losing streak in the highly volatile week ended March 11. After a weak start to the week, the market regained momentum amid tensions between Russia and Ukraine and the BJP-led NDA. Victory in four of the five states gave investors confidence Last week, the BSE Sensex closed at 55,550.3 with a gain of 1,216.49 points (2.23 per cent), while the Nifty 50 gained 385.15 points (2.37 per cent) to close at 16,630.5. . The Nifty closed 2.4 per cent higher at 16,630, while the small-cap index outperformed with a gain of 4 per cent.
Vinod Nair, Head of Research, Geojit Financial Services, said: “The domestic market witnessed heavy selling as oil prices rose above $130 a barrel for the first time since July 2008, following US and European sanctions risks. On Russia’s oil exports. However, the state election results were positive for the market and oil prices began to slide. Progress in high-level talks between Russia and Ukraine in Indian markets and increased optimism in global markets was seen.
“US CPI inflation recorded at 40-year high due to higher gasoline, food and housing costs, casting doubt on the global trend. Inflation levels in India and abroad are set to rise even higher in March, albeit tentatively.” on the basis, given the impact of the Russia-Ukraine issue,” Nair said.
Next week, the market will focus on easing commodity prices and diplomatic developments between Russia and Ukraine. If these global trends turn positive, then the Indian market will perform well, else it could be volatile. The market will also focus on inflation data to be released in India and the US, and the US Fed and BoE meeting next week.
global signal
The market will have some important things to react to, including the FOMC meeting and interest rate decisions due in the middle of this week. A rise of 50 bps was seen by the markets as imminent and discounted. However, given the ongoing geopolitical tensions and liquidity conditions, the Fed may have to limit rate hikes to just 25 bps.
Overall, the geopolitical tensions are yet to subside. They continue and it will not free global markets from their shackles. However, in the same breath, the F&O data suggests that the market may only consolidate in a broad range and may not see a major downside unless serious incremental downside occurs.
Aviation stocks in focus
The eyes of the airlines will be better in the coming days as international commercial flights to and from India are going to be fully operational after a gap of 2 years. As a result, returns for Indian airlines are expected to grow by higher margins than that of the international segment. Furthermore, as the Covid restrictions ease, a gradual pick-up in corporate travel could drive demand for air travel. Indicative February passenger data already suggests an improvement in air traffic.
While these tailwinds are underway, rising crude oil prices have continued to impact the sector’s recovery. Furthermore, with the acquisition of Air India by the Tata Group and the possible launch of Akasa Air this summer, the competitive landscape of the industry is evolving.
FPI sales
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said: “FPIs remained sellers in March as well. Till March 10, FPIs sold equity worth Rs 41935 crore through stock exchanges. In CY 2022, up to March 10, FPIs have sold equity worth Rs 113690 crore. The bulk of FPI inflows into India are coming from emerging market funds. FPIs fear that India will be more affected by the hike in commodity prices, especially the crude spike as India is a major crude importer. FPI sales are mainly confined to financial and IT segments as these segments constitute a large number of assets under FPI’s custody. One important takeaway from FPI sales is that it is not affecting all segments. For example, FPIs sold IT stocks worth Rs 10,984 crore in February, but IT is one of the best performing sectors in March.
nifty
“Technically, Nifty witnessed a smart pullback from 16,700 levels and a bullish engulfing candlestick formation on the weekly chart, which is a positive sign, however 16,800-17,000 is an important supply zone as it forms a conglomerate of 20 and 200-DMA. Is. Bulls need to take Nifty above 17000 level to come back aggressively in the game otherwise there is a risk that bears may reactivate where 16,300-16,250 would be immediate and critical support zone then 16,000-15,500 next support zone Santosh Meena, Head of Research, Swastika Investmart Ltd. said.
bank nifty
In the current sell-off phase, Bank Nifty has underperformed relatively as large shorts were formed where future open interest of Bank Nifty reached historical highs. As the broader markets rebounded, Nifty managed to gain around 2.5 per cent, while Bank Nifty closed with a gain of only 0.5 per cent.
“Most private banks saw call writing as well as short positions in ATM and OTM strikes. On the positive side, we feel there could be limited downside, as India VIX failed to sustain above 30 levels despite a sharp jump in volatility across the globe and ended the week close to 25,” ICICI Securities said in a statement. mentioned in the note.
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