InvestorQ : How do you see the Nifty and Sensex on Tuesday 15th November, after the flat market show on Monday?
Juvina Maggie made post

How do you see the Nifty and Sensex on Tuesday 15th November, after the flat market show on Monday?

diksha shah answered.
2 weeks ago

On Monday, the Nifty closed lower by 20 points on Monday but the trading was largely lacklustre through the day. Obviously, the markets were taking a break after the sharp rally on Friday. The rally was visible only in specific stocks like Hindalco, Tata Motors and in Grasim, while FMCG and pharma sold off with HUL and ITC under pressure.

With most of the US inflation story reflected on Friday, there was not much of headroom for the market to move higher on Monday. The advance decline ratio almost remained neutral at around the 26:24 ratio, which shows that the markets continue to be ambivalent. However, the positive cue for the market is that the VIX at 14.91 levels, shows a typical buy on dips market with limited downside risk in terms of Nifty levels.

Foreign portfolio investors or FPIs were net buyers in the equity segment to the tune of Rs.1,089 crore on Monday even as domestic funds and LIC bought stocks worth a very paltry Rs.47 crore. What is more notable was the gross volumes of FPIs, which was well above Rs40,000 crore, largely on the back of major block deals. FPIs have now infused close to $2.55 billion into equities in November so far, albeit staying sellers in the debt market.

In terms of global market cues, the US cues are on the downside. On Monday, the Dow was down 211 points while the NASDAQ fell 127 points after 2 days of frenetic positive activity. That is more of a normal movement after the initial burst of enthusiasm. Europe was in the positive while the SGX Nifty is trading around 54 points higher in early trades on Tuesday. The markets may react positively today to favourable inflation reading for October 2022.

To sum it up, the indices were largely listless on Monday. However, the CPI inflation and the WPI inflation came in sharply lower and that would be a positive development. In fact, the WPI inflation has come in at a 19 month low. In terms of the RBI trajectory, it now appears that the RBI may hike rates by around 50 bps in December. However, post that the RBI may choose to pause before further rate hikes. If the RBI indicates a gradual shift from inflation control to growth support, the markets would be substantially flattered. The first signs would be visible when the Fed announces its minutes in the next week.