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Domestic markets are expected to open on flat note on Tuesday. Analysts expect profit taking at higher level, as they await cues from US inflation data.
SGX Nifty at 18330 against Nifty futures’ closing of 18310 suggests a flat to positive opening. Overnight, the US stocks closed on mixed note. While Nasdaq and S&P 500 closed in the green, the Dow ended in the red. However, all the three indices recovered sharply from initial jitters.
The markets surpassed last week’s high with an ease which not many would have anticipated looking at Friday’s correction. “This is a sign of a strong trended phase where every dips are getting bought and the broader markets (midcaps and small caps) are witnessing good buying interest. Hence, until any reversal is seen, the trend continues to be positive and thus traders should continue to trade in the direction of the trend,” said Ruchit Jain ,Lead Research, 5paisa.com.
Analysts, however, expect the market to move in range ahead of US inflation data, which will set trend for markets across the globe. The continuous buying by foreign portfolio investors in heavy quantities bode well for domestic markets, they added.
Eye on earnings
Continued earnings momentum in banking stocks and sustained credit growth at 15.9 per cent led to a rally in Nifty Bank. “For the week, we expect the market to continue with its positive structure dictated by corporate earnings and consistent buying by FIIs. Investors would watch out for economic cues such as inflation data of India, the US and China along with UK GDP data and BoE interest rate during the week,” said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
The markets will keep one eye on the quarterly results & the management commentary while also focusing on the US regional banking crisis, US government debt concerns, inflation and the crude oil prices, said Mitul Shah - Head of Research at Reliance Securities.
India VIX was down by 2.68 per cent intraday and settled at 12.63. “Volume profile indicates Index has a strong support around 17950-18050 zone.,” sad Choice International. “Coming to the open interest data, on the call side, the highest OI observed at 18300 followed by 18500 strike prices while on the put side, the highest OI is at 18200 strike price,” it added.
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