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After the huge fluctuations and selling in the Indian stock market for the last few sessions, the heartbeats of the investors have increased. Market experts say that amid global cues and domestic institutional activities, there is an atmosphere of sluggishness on Dalal Street. Now the big question in the minds of investors is whether the market will bounce back after recovering from this recession or there is a need to remain cautious. In this special report we are analyzing the latest trends and market sentiment of Sensex and Nifty.
The major indices of the Indian stock market made a sluggish start in the last trading session of the week. The 30-share Sensex of Bombay Stock Exchange and Nifty 50 of National Stock Exchange were seen trading with slight fluctuations. Due to heavy selling in the previous sessions, a cautious attitude is clearly visible even among the market leaders. However, the return of buying at lower levels in some select sectors has definitely given some strength to the market, but it may take some time to completely restore investor confidence.
At present, the direct impact of the developments in the international market is being seen in the Indian equity market. The policies of the US Federal Reserve, continuous changes in bond yields and fluctuations in crude oil prices have left global investors confused. Foreign institutional investors (FIIs) are reevaluating their strategies, which is resulting in sell-off or limited range trading in Indian markets. Experts believe that unless there is a strong positive signal from the global market, the domestic market will be seen moving within a limited range.
Talking on the technical front, senior market analysts say that important support and resistance zones have become very important for Nifty and Sensex. There is a strong support zone for Nifty at lower levels, while on the upside, selling pressure can be seen on every bounce. Experts suggest that retail investors should avoid making any hasty purchases in this volatile environment and should focus only on stocks with strong fundamentals.
Corporate earnings data, macro-economic data and geopolitical conditions will decide the direction of the stock market in the coming weeks. For long term investors, this is the time to be patient and balance their portfolio. If you are thinking of creating new positions in the market, keep technical indicators and expert advice in mind so that the risk can be minimized.