<p>Indian markets are showing signs of weakness as US Fed’s aggressive stance increased recessionary fears on global front and created nervousness. Nifty on Friday, broke its crucial support of 17,400 levels, while India VIX rose sharply to 20.5 levels, indicating that volatility may remain high going forward. For the week, markets would take cues from the global factors, RBI policy meeting and institutional flows.</p>.<p>Nifty slipped for the second consecutive week and is facing resistance near the 18,000-mark, from where it has turned thrice recently. Defensive sectors like the FMCG and Pharma saw buying interest while rest of the sectors faced selling pressure.</p>.<p>Accenture’s inline Q4 results, strong deal wins and robust initial guidance for FY23, suggested good traction for Indian IT industry. Thus IT companies managed to end the week with marginal loss.</p>.<p>Global negatives have once again started outweighing the domestic positives, resulting in Nifty losing its shine for the calendar year. Nifty which had outstripped global markets and turned positive for the year with 3% gains, is now down marginally by 0.2%.</p>.<p>Post the rate hike and hawkish commentary by US Federal Reserve, ~11 more countries have raised their interest rates by 50-75 bps last week. Even RBI in its upcoming meeting on September 30, would be under pressure to raise interest rate. As a result, India’s 10 year G-sec yield surged to a two-month high of 7.39%. This could bring some pressure on the banking and NBFC sectors.</p>.<p>Rupee fell to a fresh all-time low of 81.24 against the dollar, while most of the other currencies too are under pressure as the dollar index spiked to a 20-year high.</p>.<p>US two-year G-sec yield surged to a 15-year high of 4.15%, which is a major concern for the market. Brent crude fell to a seven-month low below $90/bbl, on demand concerns due to fears of economic slowdown.</p>.<p>Off late the foreign institutional investors (FII) are too succumbing to global pressure and are seen as net sellers intermittently. Last week,<br />they turned net sellers after being continuous buyer for five consecutive weeks.</p>.<p>Apart from the RBI MPC and FII flows, focus this week will also be on US GDP data, new home sales, Consumer Confidence data as well as Fed Chair Powell’s speech.</p>.<p><em><span class="italic">(The writer is Head - Retail Research, Motilal Oswal Financial Services Limited)</span></em></p>
<p>Indian markets are showing signs of weakness as US Fed’s aggressive stance increased recessionary fears on global front and created nervousness. Nifty on Friday, broke its crucial support of 17,400 levels, while India VIX rose sharply to 20.5 levels, indicating that volatility may remain high going forward. For the week, markets would take cues from the global factors, RBI policy meeting and institutional flows.</p>.<p>Nifty slipped for the second consecutive week and is facing resistance near the 18,000-mark, from where it has turned thrice recently. Defensive sectors like the FMCG and Pharma saw buying interest while rest of the sectors faced selling pressure.</p>.<p>Accenture’s inline Q4 results, strong deal wins and robust initial guidance for FY23, suggested good traction for Indian IT industry. Thus IT companies managed to end the week with marginal loss.</p>.<p>Global negatives have once again started outweighing the domestic positives, resulting in Nifty losing its shine for the calendar year. Nifty which had outstripped global markets and turned positive for the year with 3% gains, is now down marginally by 0.2%.</p>.<p>Post the rate hike and hawkish commentary by US Federal Reserve, ~11 more countries have raised their interest rates by 50-75 bps last week. Even RBI in its upcoming meeting on September 30, would be under pressure to raise interest rate. As a result, India’s 10 year G-sec yield surged to a two-month high of 7.39%. This could bring some pressure on the banking and NBFC sectors.</p>.<p>Rupee fell to a fresh all-time low of 81.24 against the dollar, while most of the other currencies too are under pressure as the dollar index spiked to a 20-year high.</p>.<p>US two-year G-sec yield surged to a 15-year high of 4.15%, which is a major concern for the market. Brent crude fell to a seven-month low below $90/bbl, on demand concerns due to fears of economic slowdown.</p>.<p>Off late the foreign institutional investors (FII) are too succumbing to global pressure and are seen as net sellers intermittently. Last week,<br />they turned net sellers after being continuous buyer for five consecutive weeks.</p>.<p>Apart from the RBI MPC and FII flows, focus this week will also be on US GDP data, new home sales, Consumer Confidence data as well as Fed Chair Powell’s speech.</p>.<p><em><span class="italic">(The writer is Head - Retail Research, Motilal Oswal Financial Services Limited)</span></em></p>