Domestic markets are expected to open on flat note on Wednesday. Analysts expect the market to continue the momentum, tracking positive global cues.

GIFT Nifty at 19529 indicates a flat opening with a positive bias as Nifty futures on Tuesday closed at 19500.

Equities across Asia-Pacific region are up mixed even as the US stocks closed on a strong note.

“While the world is struggling on various economic parameters, India continues its upward march on various economic fronts and the latest being the strong direct tax collection numbers which further boosted investors’ confidence,” said Shrikant Chouhan, Head of Research (Retail), Kotak Securities Ltd.

Investors confidence

“While positive global cues aided the sentiment, traders bought automobile, capital goods, power and FMCG stocks. However, markets may have to brace for intra-day volatility going ahead in the run up to the US Fed’s FOMC meeting on July 26,” he added.

Besides, the results of of corporate majors will impact the market sentiment.

Tata Consultancy Services and HCL Technologies will announce their Q1 FY24 results later today.

According to analysts, the results will set the tone for market direction.

5Paisa.com, Anand Rathi, Hathway Cabletel and Steel Strips Wheels will also announce their quarterly numbers today.

Results season

Vinod Nair, Head of Research at Geojit Financial Services, said:  “The market now awaits the Q1 results, especially of the IT majors. The expectations are muted with a focus on the sustenance of margins and improvements to long-term guidance.”

If the poor results trigger correction in IT stocks, it may provide buying opportunities in the segment.

IT majors have a great track record of successfully overcoming many crises, he added.

Devarsh Vakil, Deputy Head - Retail Research, HDFC Securities, said, ”Market volumes on Tuesday were higher as compared to last ten-day average. Global Markets are awaiting US inflation data on Wednesday to see if price pressures are continuing to moderate, providing clues on the interest rate outlook.

Gaming stocks

According to analysts, gaming stocks such as Nazara Technologies, Delta Corporation and Zensar Technologies might come under pressure due to 28 per cent Goods and Service Tax.

The GST council on Tuesday decided to levy a 28 per cent GST on the full value of gaming , horse racing, and casinos. The move is seen as a setback for online gaming companies.

“Nazara Technologies Limited would like to clarify that this tax (28% GST) will apply only to the skill-based real money gaming segment of our business. The contribution of this segment to our overall consolidated revenues for the financial year FY23 was 5.2%,” Nazara said in an exchange notice.

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