Dear Trader…
Indian equity benchmarks ended marginally higher on Monday amid choppy trade and tracking global markets. The key indices made cautious start, as traders got anxious with the former World Bank Chief Economist Kaushik Basu’s statement that India's overall macroeconomic situation is in a recovery mode but the growth is concentrated at the top end, which is a worrying trend. Amid the rising inflationary trends, including the sharp increase in retail inflation last month, Basu said the country is facing stagflation and ‘very carefully curated policy interventions’ are required to address the situation.
The key benchmark indices continued to hold marginal gains in late afternoon deals, as some solace also came with depositories data showed foreign portfolio investors (FPIs) reversed the three-month selling streak in January by investing net Rs 3,117 crore in Indian markets, so far this month. They pumped Rs 1,857 crore into equities and Rs 1,743 crore into hybrid instruments during January 1-14.
Nifty futures opened at 18248.00 points against the previous close of 18295.00 and opened at a low of 18234.50 points. Nifty Future closed with an average movement of 115.50 points and a rise of around 44.90 points and 18339.90 points...!!
On the NSE, the midcap 100 index will rise 0.16% and smallcap 100 index is closing rise 0.60%. Speaking of various sectoral indices only Pharma, PVT Bank, Bank, Financial Services and IT stocks were seen selling on the NSE, while all other sectoral indices closed higher.
At the start of intra-day trading, February gold opened at Rs.47835, fell from a high of Rs.47965 points to a low of Rs.47803 with a rise of 129 points, a trend of around Rs.47907 and March Silver opened at Rs.61666, fell from a high of Rs.62060 points to a low of Rs.61652, with a rise of 333 points, a trend of around Rs.61936.
Meanwhile, the former World Bank Chief Economist Kaushik Basu has said that India's overall macroeconomic situation is in a recovery mode but the growth is concentrated at the top end, which is a worrying trend. Amid the rising inflationary trends, including the sharp increase in retail inflation last month, Basu said the country is facing stagflation and ‘very carefully curated policy interventions’ are required to address the situation. He said while the aggregate economy is growing, ‘the bottom half of India’ is in recession, and noted that it was sad the country's policy over the last few years has been largely focused on big businesses.
He also said the youth unemployment rate in the country touched 23 per cent, among the highest globally, even before the COVID-19 pandemic started. He added workers, farmers and small businesses are seeing negative growth. While India's GDP is estimated to grow 9.2 per cent in 2021-22, Basu said since this comes after a contraction of 7.3 per cent in 2019-20 due to the pandemic, the average growth rate over the last two years is 0.6 per cent per annum. On whether the government should be going for fiscal consolidation or continue with stimulus measures in the upcoming Budget, Basu said the current situation in India is a big challenge to Finance Minister Nirmala Sitharaman and the entire fiscal policy apparatus.
Technically, the important key resistances are placed in Nifty future are at 18370 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 18404 – 18474 levels. Immediate support is placed at 18288 – 18232 levels.
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