InvestorQ : Have you changed your trading view after the bounce in the markets on 01 March? Can we say markets have taken support? What is your view for 02 March?
Arusha Ray made post

Have you changed your trading view after the bounce in the markets on 01 March? Can we say markets have taken support? What is your view for 02 March?

Answer
image
diksha shah answered.
3 months ago
Follow

After the carnage on Black Friday, it was a welcome respite on Monday. Nifty bounced 232 points and Sensex rebounded by 750 points to recoup part of the losses of Friday, when the Sensex fell by 1939 points. On Monday, the rally was driven by PSU stocks like ONGC and Power Grid but Bharti Airtel remained under pressure through the trading day.

As I told you in the past, the VIX is a key factor to watch out for and that has tapered marginally from 28 levels to around 26 levels. However, it is still too high to be able to commit fresh investments in a big way. Bond yields showed some signs of tapering and the RBI TLTROs should gradually reduce that risk also.

Foreign portfolio players were not too significant on Monday at a net level. While FPIs were net buyers to the tune of Rs.125 crore, DFIs sold Rs.195 crore. In Feb-21, FPIs infused Rs.23,000 crore despite the Rs.8,295 crore sell-off on Black Friday. However, if you exclude the Rs.29,800 crore Bosch block deal, FPI flows were actually negative in Feb-21.

Global markets showed a sharp bounce on Monday after the tentative approach in the previous week. The Dow rallied by a good 1.9% while the NASDAQ was up2.5% on Monday. Even the European markets rallied more than 1.6% on 01 March. SGX is trading strong in early trades. So clearly, the outlook for Tuesday looks to be quite encouraging.

Regarding changing my view, I have held that the Indian markets are poised for a long term bull rally, intermediate corrections notwithstanding. The best you can do is to use dips as opportunities to accumulate quality stocks. Once the yields stabilize, the VIX should also taper and that will give more confidence and stability to the market direction.

3 Views