Domestic markets are likely to open flat with positive bias on Monday amid mixed global signals. According to experts, equity benchmarks may soon hit new peak on the back of buying by FPIs who have been pumping in more money into Indian stocks last few days. Domestic economy looks bright and India Inc have largely came out with better set of numbers, they added.
SGX Nifty at 18,450 (at 7.40 am) indicates another positive opening as Nifty futures on Friday closed at 18,424. Asia-Pacific stocks are mixed and most of them treading in the middle line, despite a strong closing by the US stocks last week.
Mitul Shah, Head of Research at Reliance Securities, said the fall in US inflation in October has sparked the market’s newfound confidence that US central bank may slow the pace of its interest rate hike. “However, the big crypto crash and the ongoing geopolitical uncertainty remains a major threat to the markets,” he added.
FPIs on buying spree
VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: “There is a major change in the FPI activity in November. According to NSDL data, FPIs have bought equities worth ₹18,979 crore in November.
“In fact, they were buyers in all trading days of the month till 11th. There is a clear change in the approach of FPIs since they bought even when the dollar and US bond yields were rising,” he said.
According to Shah, the Q2 FY23 earnings season has largely ended with 450 out of BSE 500 companies reported healthy 27 per cent year-on-year growth in revenue, but inflationary pressure toll on profitability with EBITDA growth of just 4 per cent y-o-y while PAT fell by 7 per cent y-o-y.
“Currency fluctuations, elevated commodity and logistics costs, and geo-political issues were the major inhibitors of growth. However, we expect a recovery starting Q3 FY23 led by softening of commodity prices and some relief on monetary policy of central banks which is likely to boost demand,” he further said.