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Domestic markets are expected to open on flat note with a downward bias on Tuesday, amid mixed global cues. Analysts expect profit taking to continue at domestic market, due to stiff valuation.
Geopolitical meets
SGX Nifty at 18,800 indicates a marginal decline at open, as Nifty June futures on Monday closed at 18840 on the NSE. With foreign portfolio investors also resorting to profit-taking, analysts expect the market may face pressure on every rise. Besides, the focus now shifts to Prime Minister Narendra Modi’s upcoming US visit, where crucial economic and corporate dealings are expected to be discussed/signed.
Also read: Stock to buy today: Mishra Dhatu Nigam (₹283.95)
Nifty was just a fingertip away from its all-time high zones as the index failed to sustain higher levels amid volatility.
The focus remains on geopolitics this week, as the US Secretary of State is set to meet the Chinese President today while PM Modi is set to visit the US this week, which is likely to bring deal wins in the defense space and strengthen trade relations, said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
Also read: The import of Modi’s US visit
VIX rises
According to analysts, F&O market signals cautious stance.
The India VIX, known as the fear indicator, rose 3.55 per cent to 11.22, gave major discomfort to the bulls. Heavy call writer additions were observed in 19,000, 18,900 & 18,800 strikes, said Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities.
Also read: Day Trading Guide for June 20, 2023
The Put-Call Ratio (PCR), a sentiment indicator, for Nifty stood at 1.26, closing below the previous swing low of 1.28, made on June 9. “Monday’s fall in the Index was on account of initiation of fresh short positions as indicated by Future Open Interest (OI) Data,” said Ashwin Ramani.
Shrikant Chouhan, Head of Research (Retail), Kotak Securities Ltd, said: “Risk-off sentiment prevailed in local markets, as sell-off in global equity markets triggered profit-taking in banking, auto, telecom, and FMCG stocks. Although India’s macroeconomic indicators seem to be on the right path, global headwinds would fuel bouts of selling at regular intervals.”
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