Indian markets hit fresh intraday highs before witnessing profit-booking at elevated levels, as investors await Wednesday’s crucial US inflation data, which holds significance in shaping future rate cut decisions by the US Federal Reserve, according to Vinod Nair, Head of Research at Geojit Financial Services.
Concerns have arisen amidst recent better-than-expected US employment and manufacturing data, hinting at a possible change in expectations regarding rate cuts for the year. Additionally, escalating geopolitical tensions in the Middle East, coupled with supply worries, have driven crude prices higher, impacting overall market sentiment. In the short term, attention will pivot to Q4 earnings, set to commence this weekend.
Indian markets have surpassed all-time highs, buoyed by optimism surrounding robust earnings growth, a resilient economy, and substantial total flows, reaching $50 billion for FY24, with approximately $2 billion monthly from domestic SIPs, as highlighted by Rakesh Parekh, MD & Co-Head of Portfolio Management Services at JM Financial.
“We maintain a highly positive outlook on the Indian economy and markets, expecting momentum to persist with greater strength throughout 2024, particularly following the anticipated return of the current government in June,” Parekh stated.
Rupak De, Senior Technical Analyst at LKP Securities, observed that although Nifty commenced higher, it struggled to withstand selling pressure at elevated levels. The hourly chart’s RSI indicates a bearish divergence, suggesting a potential shift in price momentum towards the downside.
