As the war of words escalates between Russia and US over Ukraine, global markets on tenterhooks with bears gaining upper hand on each passing day. The US Stocks plunged over night, especially the tech-focused Nasdaq slumped 407.38 points (2.88 per cent), Dow Jones plunged 622.24 points (1.78 per cent) and the S&P 500 94.75 points (2.12 per cent).

However, the pain was not that deep in Asia-pacific markets in early deal on Friday. Most Asia-Pacific stocks are down between 0.1 per cent and 0.7 per cent.

SGX NIfty at 17,250 indicates a 40-point gap down opening for Nifty, as Nifty futures on Thursday closed at 17,290 on the NSE.

Prashanth Tapse, Vice-President (Research), Mehta Equities, said: "With geopolitical tensions and rising inflation concerns on front pages, we suspect, investors are likely to stay at sidelines."

Headwinds

With so many dark clouds hanging around such as higher crude oil over $92 per barrel, outcome of State elections, rate hike fears and continuous selling by foreign portfolio investors, said analysts.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd, said: "Markets remained volatile but moved in a range during the last session as the haze over Russia-Ukraine conflict and subsequent volatility in crude prices is keeping investors on tenterhooks. Also, all eyes are on the upcoming mega IPO of LIC, which traders fear could result in further redemption from local equities in the near-term."

Devarsh Vakil, Deputy-Head, Retail Research, HDFC Securities, said: “Advance decline ratio remained subdued today, with 6 shares out 10 stocks going down. WTI crude oil fell 2 per cent and was trading near $91.6 per barrel. “Outcome of State elections and fears of interest rate hikes in India and abroad continue to plague the sentiments,” he added.

‘Banks recovery is crucial’

According to Ruchit Jain, Lead Research, 5paisa.com, Thursday's move from the banking index was disappointing as this heavyweight sector needs to participate for any positive structure on the benchmark.

"Until the index gives a clear breakout, we continue with our advice for short-term traders to avoid aggressive positions and trade with proper risk management," he added.

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