Negative global cues continue to daunt mkts

Continued to be spooked by the Israel-Hamas conflict, higher bond yields, unabated selling by FIIs and the weak ongoing earnings season; the domestic markets fell by around 2.5 percent during the week ended to June levels. BSE Sensex fell 1,615 points to settle at 63,783 points, and NSE Nifty plunged 495 points to 19,047 points. The Nifty Mid-cap and Small-cap indices were also down three per cent and two per cent. DIIs have managed to offset the FII outflow to a major extent by buying Rs11,550 crore worth of stocks during the week and Rs23,400 crore in current month.

Speculative asset class Bitcoin has also witnessed surprising demand on the back of Israel-Hamas conflict and has touched $35,000 during the course of week. Bitcoin is a highly volatile and speculative investment, prone to wild swings in price. In the short-term, market sentiment remains cautious, with investors closely monitoring developments in the West Asia, US Fed meeting outcome, international crude oil prices, rupee-dollar fluctuations, upcoming corporate earnings, and key economic data, including domestic PMI figures. Global volatility may delay the recovery trend in the domestic market since the global market is focused on the risk of further slowdown in global economy due to elevated interest rate and rising geo-political tension. Coming week would witness results from prominent companies like like State Bank of India, Larsen & Toubro, Tata Motors, Bharti Airtel, Tata Steel, Sun Pharmaceutical, Hero Motocorp, Titan, UPL, Tata Consumer, Adani Enterprises, Britannia Industries, GAIL India, IOC, Ambuja Cements, TVS Motor, InterGlobe Aviation, DLF, Godrej Consumer and IEX. Unfazed by the uncertainty in secondary market, the primary market to attract good inflows. In the mainboard segment, IPOs of consumer-ware company Cello World and Mamaearth parent HonasaConumer will be opening in the week ahead. In the SME segment, Transteel Seating Technologies, Vrundavan Plantation, Mish Designs and SAR Televenture are in the line.

F&O/ SECTOR WATCH

Derivatives segment witnessed heightened activity during the settlement week. Rollovers in Nifty futures were at 83per cent (last month 76%), above last 3-month average of 79 per cent. On other hand, market wide rollovers stood at 92 per cent (last month market wide 92per cent). Rollover cost was at 0.52.

(The author is a senior maket analyst and former vice- chairman, Andhra Pradesh State Planning Board)