Recovery in crude oil prices, negative interest rate strategy of Bank of Japan and the news that US Fed may go slow on interest rate hikes helped most of the emerging markets to rebound. The Indian markets ended the 1st month of 2016 with a bang, recovering from the setback it suffered in the initial three weeks. The markets ended at 24,871 (Sensex) and 7,564(Nifty) recording an almost 2% jump from the previous week’s close. February derivatives series have kicked off with a bang on Friday.
Going ahead, expectations of the union budget are likely to drive the sentiments from now on. Investors expect a big bang budget from the finance minister which will lay the foundations for a double digit growth. The RBI policy meet this week will also be an important factor in deciding the short term movement. The RBI bi monthly meet is on Tuesday and it is expected to keep the rates unchanged until the budget. The Auto sales numbers for January, Q3 numbers and the rupee-dollar movement are other factors that can the indices to move in the next week.
The Indian markets witnessed sharp sell off during the early part of the week and then towards the end, regained ground.. At the end – both the sensex and the nifty closed the week with marginal losses at 24,436 and 7,422 respectively. Although FIIs were selling off their holdings, Indian financial institutions have pumped in more than 10,000 crores into the market in the last 20 days. The surge in crude oil prices and reasonably good Q3 results has improved the market sentiments to a great extent. The indices hit a low of 23,839 / 7241 before bouncing back to the present level.
2016 so far has been a horrifying experience for stock investors. The first week of the year kicked off with crash in stock markets due to weak Chinese data. The second week isn’t any better with the markets crashing again due to fall in crude oil prices. We are not talking about Indian markets alone – the Nasdaq , Dow , DAX , FTSE etc are all down. The indices in the emerging markets are down in double digits. Compared to what other countries are facing, we think Indian markets are better off! The last week’s fall wasn’t that big with the Sensex and the Nifty closing at 24,455 and 7,438 respectively. The fall is fine, as long as the indices start creeping g higher from here. If the present scenario continues, it could create more problems for investors.
The Indian indices – sensex and the Nifty – slumped to 24,934 and 7601 respectively as global indices crash due to china’s stocks markets hit circuit breakers. The China’s hang-seng index lost 10% last week wiping out all the gains that was made from last October. The Indian indices are now posied at critical support levels and is positioned just above the lows recorded September and December 2015. Further downward movement will weaken the overall outlook of the market.
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