Domestic markets are expected to open on a flat to negative note on Monday. According to analysts, there is a lack of triggers to keep the market on sideways while select counters will see action today.
Gift Nifty at 24,125 against Nifty futures price of 24,132.25 indicates a marginal downward bias at the start.
The Indian stock markets exhibited positive trends as the Sensex and Nifty indices both posted minor gains of 0.2 per cent last week, marking their third consecutive week of growth. The Nifty Bank index, in particular, stood out with its largest weekly gain of 2024, surging by more than 3 per cent. This impressive performance also signifies the Nifty Bank’s longest winning streak in 19 months, as it recorded gains for the sixth straight week.
‘Rotational buying’
Ajit Mishra – SVP, Research, Religare Broking Ltd, said rotational buying across key sectors is driving the current uptrend, with expectations that Nifty will hold the 23,400-23,700 zone in case of profit-taking, while eyeing levels above 24,500. IT and FMCG sectors are expected to play pivotal roles alongside banking in maintaining a positive sentiment, he said adding that Selective participation from heavyweight stocks in other sectors is likely to support the upward movement.
“The consolidation phase in broader indices is expected to conclude soon, although participation may be limited to quality names. Traders are advised to continue with a “buy on dips” on strategy, focusing on careful stock selection,” he added.
FIIs rollover longs
According to Ruchit Jain, Lead Research, 5paisa.com, said: “Our markets have seen a run up in last few days mainly led by buying interest from the FIIs wherein they formed long positions in the index futures segment and also rolled over most of the long positions to the July series. The overall rollover in Nifty was higher than last 3-months average while ‘Long Short’ ratio of FIIs at the start of the new series is over 80 percent. However, the Client section is on the short side and if we look at overall positioning, then it seems that they are not willing to form longs at current levels while the FIIs already hold long heavy positions. Thus, it would be interesting to see the formation of new positions by market participants in the coming week.”
According to analysts, till Budget, market will look for cues on economic front both at domestic and global levels.
Arvinder Singh Nanda, Senior Vice President, of Master Capital Services Ltd, said: The outlook for the market will be guided by the major domestic and global economic data such as HSBC India Manufacturing PMI, HSBC India Services PMI, S&P Global Manufacturing PMI (Jun), ISM manufacturing PMI, Fed speech, JOLT Job opening data, ADP Nonfarm Employment Change, Initial Jobless Claims , Unemployment Rate decisions will guide the market next week.
Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd, said; this week, sector-specific movements are anticipated amid budget-related buzz. Key factors to watch include the progress of the monsoon, which will be closely monitored for its near-term impact on investor confidence. The upcoming GST meeting may result in rate adjustments in certain sectors, potentially influencing market direction. Investors will also keep a close eye on FII and DII fund flows, as well as crude oil prices, to gauge overall sentiment.
However, foreign portfolio action, both in cash and derivative segments, will be watched closely.
Looking ahead, attention will gradually shift towards the budget and Q1FY25 earnings, which could determine the sustainability of FPI flows, said Vipul Bhowar, Director, Listed Investments, Waterfield Advisors. “The primary goal of including the bond index is to attract foreign investment into the Indian debt market rather than the equity market. As foreign investors become more familiar with the Indian fixed-income market, they may start to explore other investment opportunities, thereby opening up new avenues for growth and diversification, which should be a source of optimism for the future of FPI in India,” he added.
Meanwhile Asian stocks are ruling mixed and showing lacklustre trading pattern. While Japan stocks are up marginally in early deal on Monday, Australia equities are down.