Gift Nifty trading is expected to start with a negative tone on Monday, as per the current market trends. The Gift Nifty is currently at 22,970 compared to the Nifty futures (Jan) value of 23,113.90 and (Feb) value of 23,246.65, indicating a potential gap-down opening of around 150 points.
The market seems somewhat relieved by the initial actions taken by US President Donald Trump on the tariff front. The attention has now shifted to the upcoming Budget on Saturday. The ongoing results season has been disappointing, leading to significant sell-offs, according to analysts.
IFA Global Research noted that President Trump’s recent speech was consistent with his previous rhetoric, and his executive orders were in line with expectations. While there were mentions of tariffs, the lack of specifics has reduced fear in the market, resulting in reduced volatility across asset classes. However, the future remains uncertain as Trump’s presidency progresses.
Looking ahead, the focus will be on the Fed rate decision scheduled for Wednesday. The Fed is anticipated to keep rates unchanged, with the market pricing in future rate cuts. The ECB policy is also due on Thursday, with expectations of a rate cut. Overall, the market is bracing for potential monetary policy changes in the coming week.
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted the continued selling pressure from foreign institutional investors (FIIs). The strengthening of the dollar and rising US bond yields have been the primary drivers of FII selling in the Indian equity market. He noted that as long as the dollar index and bond yields remain high, selling pressure is likely to persist.
Meanwhile, Ajit Mishra of Religare Broking Ltd emphasized the significance of the upcoming week, with the Union Budget scheduled for February 1. Market participants are hopeful for measures to boost the economy while maintaining fiscal discipline. Additionally, several major companies are set to release their earnings reports during the week, adding to the market’s overall sentiment.
Overall, the market remains cautious amid global uncertainties and domestic developments, with all eyes on upcoming events and announcements that could impact market dynamics. The coming week is expected to be eventful, with significant economic implications and potential market reactions.
