Tracking gains in broader Asia and a fall in oil prices, Indian stock markets rose sharply today. The BSE Sensex and the broader Nifty 50 benchmark indices were up 1% at 60,564 and 17,955, extending the previous week’s gains. The Sensex has climbed over 3,000 points this month alone on strong corporate earnings reports and expectations of a less aggressive stance from major central banks.
Oil prices fell today on concerns that a widening of COVID-19 restrictions in China will dent demand, while India, the world’s third-largest oil importer, benefits from a fall in prices as it lowers imported inflation. Is.
This week, stock market investors will take a closer look at the outcome of policy meetings of the US Federal Reserve and the Bank of England. A surprise meeting of the Reserve Bank of India (RBI) is also going to take place. The RBI has scheduled an additional meeting of its policy-making committee on November 3 to potentially discuss the government’s response if it fails to stick to its inflation target for three consecutive quarters.
“technically” Share Market Mother Markets is set to continue the ongoing rally supported by the US, where the Dow’s 828-point rally last Friday posted gains for the fourth consecutive week. The driving force behind the ongoing rally is the strength of the US economy indicating less likelihood of an immediate US recession and more importantly, inflation is stabilizing and may show a declining trend soon. This could enable the Fed to soften its hard stance a bit. Central banks in Canada and Australia have already raised rates lower than expected. If the trend extends, it would favor a continuation of the rally in the near term. The fact that FPIs have become buyers during the last 2 days is another positive,” said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
But DIIs can sell higher as the valuations are higher.
Foreign institutional investors made net buys on Friday Equity worth 1569 crores, while domestic investors sold As per the provisional data available with the National Stock Exchange, 613 crore shares.
“Meanwhile, global data contradictions abound. US GDP growth was stronger than expected (due to stronger oil exports), even though the DXY has weakened against market sentiment at a slower than the Fed’s anticipated rate hike since November. An ECB guidance, coupled with a Dovish Bank of Canada rate hike, confirms that such optimism of the markets may not be entirely unfounded, SBI Research said in a note.
On the technical side, Anand James, Chief Market Strategist, Geojit Financial Services, says, “From the preferred approach, a breach of 18,100 is expected. nifty And moving towards 18350-18600, but a direct rise above 18100 will certainly attract liquidation pressure in the long run. Key points that can be used as trailing stop-losses are now at 17470 and 17750 which are broad and presents a risk if the VIX were to rise from here. This is the major risk ahead.”
On other potential risk factors for the markets, CR Forex Advisors said: “One of the biggest events – Fed monetary policy – is due on November 2, where they will confirm a fourth 75 bps rate hike, but with a 2023 rate hike. His tone will be center for. Friday could be a furious one as the US releases its jobs report and next week will be a real test for Joe Biden as he must pass the midterm election smoothly. Finally, on November 10, the US CPI and Core CPI could ultimately be a game changer for the market.”
After these burgeoning economic events, it is certain that “an episode of two-way instability begins!” From here Therefore, tighten your seat belts before the rollercoaster ride,” the forex advisory firm said.
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