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Domestic stock markets are expected to open on a positive note on Monday, tracking strong global markets. Beaten-down global stocks are bouncing back, as most of the negatives are getting discounted, said market observers. The positive sentiment in global markets will have a positive rub-off effect on domestic markets, they said.
SGX Nifty at 17,706
SGX Nifty at 17,706 indicates a gap up opening of about 50 points for NSE Nifty, as Nifty March futures on Friday closed at 17,671.55. BSE Sensex is likely to regain the 60,000-mark which it lost saw on February 22. The Sensex on Friday closed at 59,808.
Strong support from local participants, especially retail investors, will help the market in continuing the momentum, the observers added.
Positive macro economic numbers and deep correction in some of the stocks providing attractive valuation, will propel the domestic funds to enter the market in big way, they added.
According to Mitul Shah, Head of Research, Reliance Securities, services PMI expanded at the fastest pace in 12 years in February 2023 on strong demand. The index rose from 57.2 in January to 59.4 in February. Strong growth in services sector boosted the composite index to 59.0 in February from January’s 57.5, despite manufacturing growth slowing to a four-month low.
Profit taking ahead of Holi holiday
Tomorrow being closed holiday for markets due to Holi festival, traders may book profits in the second half of the day to keep their position light to save from global volatility.
Ruchit Jain, Lead Research, 5paisa.com, said, FIIs, with around 1.60 lakh contracts on the short side, are short heavy like they were in June 2022 when index was around 15200.
“We then witnessed short covering. Since their positions are short heavy, it is likely that they would cover the positions which would keep a positive momentum intact in the near-term,” he said.
However, analysts fear the selling would continue from FPIs on every rise.
According to VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, FPIs have sold equities to the tune of ₹41,169 crore in 2023. FIIs are likely to sell at higher levels since the US 10-year bond yield is at 4 per cent and this is an attractive and risk-free investment for them.
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