Equity markets are showing signs of a positive opening, with Gift Nifty indicating a marginal gain at the start of trading. However, the market is expected to remain volatile due to continued selling pressure from foreign portfolio investors. Several factors are influencing market sentiment, including a decline in retail inflation, improved IIP growth, and signals of a more flexible rupee policy from the RBI Governor.
Despite these positive domestic factors, global cues, a falling rupee, low earnings growth, and FII outflows are keeping overall market sentiment cautious. The upcoming Union Budget will be critical, as GDP growth is expected to slow to 6.4% in FY25, the weakest pace in four years. Policymakers will need to implement measures to stimulate growth and attract FII inflows.
Asian stocks are down slightly in early trading, except for Korea which has seen marginal gains. In the Indian market, the VIX index has declined, indicating reduced volatility and cautious sentiment among traders. Resistance and support levels for the Nifty have been identified, with traders closely monitoring price movements around these key zones to determine the market’s near-term direction.
Overall, while there are some positive indicators in the market, there are also challenges that are keeping sentiment subdued. Investors will need to closely monitor developments in the global economy, domestic policies, and FII flows to navigate the market effectively in the coming days.
