Indian stock markets logged their fourth consecutive week of losses today, as a worsening Ukraine crisis sent oil prices surging and stoked inflation fears. Consequently, the Sensex and Nifty shed 2.7 per cent and 2.5 per cent respectively. A mixed trend was witnessed on sectoral front wherein auto witnessed sharp cut and lost 9 per cent, followed by banking and realty pack. On the flip side, metal, energy and IT tried to cap the damage. Amongst the broader indices, the midcap index ended in line with the benchmark while smallcap outperformed but ended lower by 0.3 per cent.
Ajit Mishra, VP Research. Religare Broking, said: “Markets continued to reel under pressure in the holiday-shortened week as the war between Russia-Ukraine intensified. There were rounds of negotiations between the two countries but talks ended with no meaningful result. As a result, crude oil prices rose sharply to $119 which impacted sentiments. Meanwhile, domestic data viz. auto sales and GDP data further dampened the mood. Amid all, the benchmark oscillated in a broader range but a sharp decline in the final session pushed the benchmark to a newer weekly low.”
In the coming week, the focus would remain on the Russia-Ukraine crisis and its impact on crude. Besides, on the domestic front, participants will be closely eyeing the state elections results of 5 states- UP, Uttarakhand, Goa, Punjab and Manipur on March 10. On the macroeconomic front, we have IIP data scheduled for March 11.
Global Cues
“The Russia-Ukraine conflict, fresh sanctions on Russia by global powers, and reports of the Russian attack on Europe’s biggest nuclear plant in Ukraine added more tension on global investors. In the coming week, in addition to geopolitical tensions, the domestic market will look at state election exit poll data and the global market on BoE and Fed policy statements. Based on current consensus, state elections outcome is unlikely to be a crucial factor but rather than a short-term positive & negative reaction, accordingly. Due to war uncertainties, central banks may balance their hawkish policy against expected earlier due to high inflation,” said Vinod Nair, head of research at Geojit Financial Services.
FIIs Selling Relentlessly
FIIs are selling relentlessly and selling momentum has picked up in the last few trading sessions where they have sold more than 22,000 crore while DIIs are trying to support the market as they bought around 17,000 crore last week.
Nifty Technical Outlook
Santosh Meena, Head of Research, Swastika Investmart Ltd., “technically, the overall structure is looking weak where 16.150-15,950 is a critical and immediate demand zone below this, selling pressure may get extension towards 15,500 level. On the upside, 16,500/16,800 are immediate resistance levels while 17,000-17,100 is a critical resistance zone and bulls will get confidence only above the 17,100 level.”
Bank Nifty
The structure of Banknifty is also weak however 34,000 is a crucial support and if bank nifty manages to hold this level then we can expect a bounce-back where 35,000-35,500 is an immediate resistance area while 36,300-36,600 is a critical resistance zone.
Crude Oil Prices Peak
Commodity prices are continuing their northward journey mainly crude oil prices that are near to $120 per barrel is a major headwind for the Indian market therefore market will have a close eye on the crude oil prices.
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