Sept. 3 in New Delhi: According to Vinod Nair, Head of Research at Geojit Financial Services, attitudes would be influenced by global signals, such as the publication of US payroll and PMI data, in the lack of any significant local market events.
The local market had a sizable bounce at the conclusion of the week, propelled by stronger-than-anticipated domestic manufacturing PMI and encouraging GDP growth statistics, he added.
Positive global signals also contributed to this upturn. Notably, there was significant purchasing of metal equities in expectation of more Chinese government stimulus measures. Strong sales results, he continued, helped auto stocks do nicely as well.
Due to inconsistent market patterns on the local and international fronts, investor attitude was mostly gloomy. Following the Fed Chair’s pledge to maintaining inflation within target boundaries, doubts regarding the effectiveness of US policy measures impacted on both domestic and international markets. Additionally, weak economic data from Europe contributed to the market declines in the home country, although small and mid-cap companies with a local emphasis held up well, he noted.
Following the release of mediocre economic data, investors’ confidence about a policy rate rise halt returned as the week went on. However, while investors anticipated domestic GDP figures, the effect of the same on the local market was minimal. The possibility of the Fed suspending its rate increases rose, he said, due to a number of poor economic indications coming out of the US, including softening labour market data, a lowered GDP figure, and US PCE inflation matching with forecasts.
According to institutional statistics, both FIIs and DIIs are steadily accumulating long holdings, demonstrating confidence in the market’s long-term potential, according to Shrey Jain, founder and CEO of SAS Online. Additionally, the dollar’s six-week winning run versus major currencies appeared about to come to an end on Friday. It was approaching a vital stage before the monthly US employment report, which is anticipated to play a significant role in determining the Federal Reserve’s policy path in the near future.