Indian markets log 2nd straight week of flat trade :
May 31,Mumbai (IANS) The second consecutive week of consolidation saw Indian stock markets close the week cautiously. Analysts stated on Saturday that this muted performance occurred in the midst of continued concerns over global trade and expectations for changes in domestic policy.
As investors responded to concerns about developments in U.S. tariffs and awaited the Reserve Bank of India’s (RBI) impending monetary policy announcement, the key indices, the Sensex and Nifty, saw significant volatility throughout the week and ultimately closed lower. The Sensex closed at 81,451.01 at the end of the week, while the Nifty settled at 24,750.70.
Investor confidence remained tense despite positive local clues due to conflicting signals from international markets. Following the RBI’s record dividend payment and encouraging monsoon updates, optimism initially reigned, according to Ajit Mishra, SVP, Research, Religious Broking Ltd.
In keeping with the general market consolidation, sectoral performance remained inconsistent.
For the third week in a row, the real estate index continued to rise, and the banking and energy sectors also saw positive finishes.
On the other hand, metal, auto, and FMCG companies all declined and were the biggest laggards. Despite the volatile trading environment, the midcap and smallcap indices of the larger markets also had gains of around 1.5% each.
“A fair share of trade tensions with the temporary pause and the subsequent reinstatement of US President Donald Trump’s reciprocal trade policies reiterate that the global market may contend with macroeconomic concerns, which may continue to create ripple effects in the emerging markets,” said Vinod Nair, Head of Research, Geojit Investments Ltd.
An improved monsoon outlook,a benign inflation trend,and a nice Q4 GDP growth of 7.4% are examples of favorable domestic economic indicators that could mitigate the negative. A 25 basis point decrease is being priced in by the market,which would help rate-sensitive industries,Nair said.
The conclusion of the RBI’s Monetary Policy Committee (MPC) meeting on June 6 will be the focus of attention going forward. The central bank’s position on the rate trajectory will be crucial in determining the direction of the market, particularly in the face of conflicting macroeconomic data.
The start of a new month will also allow participants to monitor high-frequency data,such as auto sales figures and other economic indicators.The monsoon development and the pattern of foreign institutional investor (FII) flows will also be regularly tracked.
Analysts predicted that changes in the U.S. bond market and any new information about ongoing trade talks will continue to affect investor sentiment globally.
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