InvestorQ : What is your stock market view for Wednesday, August 17th 2022 and do you see the rally sustaining in the markets?
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What is your stock market view for Wednesday, August 17th 2022 and do you see the rally sustaining in the markets?

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diksha shah answered.
2 months ago
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On Tuesday, the stock markets opened strong after the PBOC loosened the monetary levers and cut rates for the second time in the current year. However, the big thrust came in the afternoon when WPI inflation at 13.93% showed a full 270 bps fall from the May peak levels of 16.63%. This is likely to be positive for the RBI to tone down its hawkish stance.

The enthusiasm in the market was reflected by the breadth of the market as measured by the advance / decline ratio at 42:8 for the Nifty stocks. While metals and commodities remained under pressure, auto stocks and insurers did see a lot of buying interest on Tuesday. In fact, auto stocks have rallied a full 40% from the lows of March 2022.

On Tuesday, foreign investors net bought Rs1,377 crore as domestic funds sold stocks worth Rs.136 crore. FPIs have already infused $3 billion into equities since the start of August 2022. Global markets had a positive bias, although NASDAQ was under pressure on Tuesday. IN early trades on Wednesday, the SGX Nifty is trading around 20 bps higher.

In terms of market outlook, the sharply lower WPI inflation number for July is the good news and should hold the momentum of the markets. Markets will also await the Fed minutes late on Wednesday and if the tone indicates a slow of rate hikes, it should be positive for cost of funds and also for the liquidity in the markets.

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