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Bears to gain upper hand at the bourses on Tuesday, amid adverse global cues. Despite crude oil prices falling, albeit still at elevated levels, investors yet to regain confidence on global equities.
FPIs back to sell mode
As foreign portfolio investors resumed their selling after a brief pause, domestic markets turned volatile. According to analysts, investors remained nervous, as yield across globe once again started rising. On Monday, FPIs sold shares worth ₹1,145 crore shares.
The bulls’ confidence was knocked again amidst growing investor unease over the concerns over rising bond yields, said Prashanth Tapse, Vice President (Research), Mehta Equities Ltd. The yield on the U.S. 10-year Treasury has spiked to 2.71 per cent.
Equities dip across Asia
SGX Nifty at 17,570 indicates a gap down opening of about 150 points as Nifty futures on Monday closed at 17,723.95. Equities across Asia-Pacific region, except Taiwan, tumbled between 0.5 per cent and 1 per cent in early deal on Tuesday. The US stocks too, led by Nasdaq, continued their slide on Monday. All the three major US futures - Dow, S&P 500 and Nasdaq, are down in early deal on Tuesday, signalling pain ahead.
The risk of pickup in inflation and rise in Covid-19 case in some parts of the world continue to shape market moves, said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
"Nifty is not being able to hold on to its recovery and is witnessing selling at every bounce. Technically too, the Nifty needs to holds above 17,777 for an up move towards 18k mark," he added.
Deepak Jasani, Head of Retail Research, HDFC Securities, said advance decline ratio remained positive on Monday signifying pressure of FPI selling in largecaps. "Technically, 17522-17600 could be the next support band for the Nifty while 17784 could be the resistance for the near term," he added.
‘Bet on India’
Despite headwinds, analysts advising investors to remain in invested in Indian equities.
"Geopolitical challenges, inflation. rising interest rates, recurrence of covid in some parts of the world and premium valuations have made equity look a bit directionless in the near term," said Sorbh Gupta, Fund Manager- Equity, Quantum Mutual Fund. However, these are times for investors to stay the course in their investment journey to achieve their financial goals. Equity investors should stagger their allocation to equity over a period & move the asset allocation to the optimum level as defined by their asset allocation plan, he added.
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