Indian stock market was one who had both fortunes and misfortunes on a day, investors were seen victims of surprise. What evolved into an eventful trading day of volatility across global markets left today’s session as-up-and-down.
We started a breakout on the back of overnight markets positivity in different overseas markets. Initially cheered by hopes for the possible softening of trade tensions and upbeat corporate earnings reports, indices rallied for a while. The Nifty and Sensex both trade higher on a weak note, banking and IT sectors turning premium early today.
But optimism was short-lived in the first place. Mid-day session saw a sea change with heavy buying getting reversed at the back of rising crude oil prices and pushing inflationary pressures further. Investors began to chase fears of an upcoming global economic slowdown and a tide of profit-taking ensued. The indices declined sharply taking the market down from its earlier highs lost its gains and a few saw move into negative territory.
That volatility was also frayed by erratic long term foreign institutional investor (FII) flows. Pushed into tactical buying by the initial upside in some FIIs, then some sold when the market headed down, put some of the twitching into yesterday’s market.
Banks and financial services sector showed significant fluctuation initially which led the market to move ahead. The IT index despite driving gains in the early bucks due to some good stats was also under selling because of global macro worries. Advertisement Pharmaceutical and FMCG sectors were list in comparision fairly.
Just before the closing bell the market briefly tried a bit of a bounce on some bargain hunting. But the overall mood remained indifferent, indices closed with small up or down gains/loss based on which indices you are looking at.
Analysts have cited volatility in the day as due to both region and global headwinds. The Market instability is fueled by long term pervasive concerns and volatility around global economic slowdown, rising crude oil price circumstances & FII recalibration. Traders are to exercise utmost caution and follow a plan rather than thinking about quick profit. The eternal transformation of global circumstances, and the responses by the nations to them are driving markets to be nearly impossible to predict.
