Domestic markets remain vulnerable to selling pressure on Tuesday as well. Despite positive global cues, sentiment has taken a beating due to stiff valuation and a lack of positive triggers, both at macro and micro levels. Gift Nifty at 23,775 signals a flat to positive opening for Nifty.
Vikram Kasat, Head – Advisory, PL Capital – Prabhudas Lilladher, said: The markets witnessed a sharp sell-off on Monday as fears surrounding the spread of the human metapneumovirus (HMPV) rattled investor confidence. The Sensex plunged 1,258 points, while the Nifty fell below 23,650, marking a steep decline. All sectors ended in the red, with mid-and small-cap stocks facing the worst losses.
With the upcoming earnings season approaching and fears of FPI outflows rising, market volatility is expected to remain high, he added.
Meanwhile, equities across the Asia-Pacific region are in the green. However, Hong Kong markets are down.
According to Jashan Arora, Director, Master Trust Group: The main concern of the market pressure has been the firms’ poor business updates, particularly those from banks and FMCG stocks. The banking sector is currently navigating a landscape of tightening liquidity and slowing deposit growth. A stronger dollar and ongoing FPI selling have made the market decline worse.
“The strength of the U.S. dollar and rising bond yields created a challenging environment for emerging markets. Foreign Investors tend to pull out their capital from markets in scenarios related to currency depreciation, as it raises the risk of loss of return. Further, Investors in India have been concerned about the high valuations of Indian markets in comparison to their worldwide counterparts, and being cautious ahead of upcoming corporate results for the December quarter added to the overall concern in the market which led to a sharp decline in the market today,” he said.
Market volatility is anticipated to stay high in the near future due to company earnings, the impending budget, and international trade policy, he further said.
SHARE
Copy linkEmailFacebookTwitterTelegramLinkedInWhatsAppReddit
Published on January 7, 2025
https://www.thehindubusinessline.com/markets/sensex-nifty-set-for-flat-top-positive-start-amid-market-volatility/article69070840.ece
