InvestorQ : How do you see the stock market trend evolving on Wednesday 03rd August 2022?
Chandralekha Desai made post

How do you see the stock market trend evolving on Wednesday 03rd August 2022?

diksha shah answered.
2 weeks ago

On Tuesday, the Nifty index closed just almost flat i.e. just about 5 points higher at 17,345. However, that is not the full story. It must be said that most of the recovery in the markets came in the last couple of hours since the markets remained in the negative zone for most part of the day. It was only in late trades that FMCG led the recovery in markets.

In terms of the market structure, the the Nifty had an advance / decline of 24:26, which is almost neutral and hint at the recovery in the markets in terms of breadth. The market did show a good deal of strength after the Indian rupee strengthened from 80/$ to 78.49/$ in a span of less than 2 days, largely led by rapid export remittances.

Foreign investors were net buyers in equities worth Rs.825 crore while the domestic funds and LIC bought stocks worth Rs.118 crore on Tuesday. FPI buying is still sustaining. Oil stocks dragged the down lower by 402 points while NASDAQ was just 22 points lower on Tuesday. SGX Nifty is trading 30 bps higher but may struggle to hold the gains amidst weak Dow.

In terms of outlook, the 3 day MPC meet starts today with a possibility of a 50 bps rate hike by the RBI. Markets are likely to play it cautious. There has been a good deal of short covering and currency arbitrage in the markets and that may have played out. Of course, quarterly results have been better than the previous quarter. The overall situation is still quite mixed.