Hi Diksha, what is your view on the market trend for Monday June 06th and do you see the markets bouncing or going down?

On Friday, the markets did close in the negative but the Nifty closed the week with positive gains of around 1.4%. Big gainers in the week were Reliance, TCS and Infosys. The only thing to watch out for is the very sharp 660 bps correction in the Sensex from the peak levels and that has happened amidst a lot of volumes on Friday. Shows undertone of markets.

In terms of market internals, the advance decline ratio of the Nifty stocks was negative at 11:39 on Friday and the ratio deteriorated rapidly in the second half. Reliance continued to add value on its proposed Walgreen buy. However, pressure was seen on Ultratech, Grasim and Shree Cements even as the F&O short build up was also visible.

On Friday, FPIs net sold Rs.3,771 crore in equities while domestic funds and LIC bought stocks worth Rs.2,361 crore. FPIs sold $5.2 billion of equities in May 2022 and $29 billion since October 2021. In global markets, Dow closed 349 points lower on inflation concerns while NASDAQ was 304 points lower. SGX Nifty trades about 60 bps lower on global cues.

Let me now come to the outlook for the day. You can expect the markets to remain in uncertain zone for the day due to weak global cues. Also, expect markets to stay tentative ahead of the RBI policy announcement on 08th June. Also, there is the Fed meet later in June 2022. The underlying trend is to sell on rises till there is policy clarity.