On Friday, India’s benchmark indices Sensex and Nifty opened lower. The 30-share BSE Sensex fell 151.21 points to 74,076.42 in early trade, while the NSE Nifty fell 52.75 points to 22,461.90.
The focus will be on the Reserve Bank of India’s credit policy. Additionally, global cues will set the tone for the domestic market.
Analysts say the market is likely to remain under pressure as foreign portfolio investors continue to sell.
Asian stock indexes are trading in negative territory, with most indexes down around 1% in early Friday trading following weakness in U.S. markets overnight. Among major Asian stocks, the Japanese market was the most affected, with the Nikkei Stock Average falling more than 2.4%.
However, the main focus on Friday will be the RBI’s statement after the interest rate decision results.
The RBI is likely to continue the interest rate moratorium at the first MPC meeting in FY25, said Shishir Baijal, chairman and managing director of Knight Frank India.
“While core and headline inflation have eased significantly, food price volatility continues to impact consumer sentiment.Hence, headline inflation remains above the RBI’s target level of 4%. ” he said.
Key macro resilience
Economic growth also remains strong, as evidenced by better-than-expected GDP growth in Q3 FY24. He also said strong growth will continue to provide the central bank with enough support to keep interest rates on hold in the coming months.
The RBI is expected to focus on liquidity management and continue to withdraw easing measures to keep inflation firmly stable and below 4%.
Shrikant Chauhan, head of equity research at Kotak Securities, said: India’s services PMI in March was 61.2 compared to 60.3 in the previous month, and the composite PMI was 61.8 compared to 60.6 in the previous month.
Gold prices rose to an all-time high on Thursday after Federal Reserve officials reaffirmed their outlook for a rate cut in 2024, he said, although the timing remained uncertain.
Traders are awaiting weekly jobless claims and trade balance data from the U.S., as well as speeches from Fed officials. “All eyes will be on the RBI’s monetary policy announcement and the US non-farm employment report,” he added.
Stock-specific actions
Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, said fourth-quarter performance updates from several prominent companies are encouraging and are driving stock-specific movement in the market. Stated.
“While the Nifty has been consolidating at high levels in a narrow band for the past few sessions, the broader market has rebounded strongly, especially after the recent sharp correction. “We expect some volatility in interest rate-sensitive sectors. Overall, we maintain a positive bias towards the market and any dip can be seen as a buying opportunity,” he added.
Looking at the open interest (OI) data, the highest OI on the call side is observed at a strike price of 22,800, followed by a strike price of 23,000. Conversely, the highest OI on the put side is a strike price of 22,300, said Mandar Bhojane, research analyst at Choice Broking.
Ashwin Ramani, Derivatives & Technical Analyst at SAMCO Securities, said, “Foreign Portfolio Investor (FPI) long-short ratio was 31.24% on March 27 on the back of strong buying in index futures by FPIs. “It rose to 46.83% on April 2nd.” However, FPIs liquidated long positions and built short positions on April 3, and the ratio fell to 43.79%.
“At the 22,500 strike on the Nifty, strong put writing (Bulls entry) coupled with the exit of Cole Writer (Bears) was observed. This caused the Nifty to close above the 22,500 level. The Put Writer is now , leading call writers with 22,500 strikes and options activity on this strike will provide hints about the future direction of Nifty,” he said.
