InvestorQ : Hi Diksha, can you give me your outlook for the markets on 14 Jan 2021? How soon could the Sensex touch 50,000 levels?
Rutuja Nigam made post

Hi Diksha, can you give me your outlook for the markets on 14 Jan 2021? How soon could the Sensex touch 50,000 levels?

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diksha shah answered.
5 days ago
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Wednesday was a volatile day in the markets as the Sensex gyrated nearly 725 points in a single day. It scaled as high as 49,700 levels before giving up gains. However, the good news for the markets is the robust results from the IT stocks like Infosys and Wipro, just a few days after TCS surprised positively. Till now results have been better than expected.

As of Wednesday, the Big-3 IT results are done for TCS, Infosys and Wipro. There is only HCL Tech which will announce its results later in this week and the Tech Mahindra little later. Two trends have emerged. Firstly, guidance appears to be strong across business lines. Secondly, margins improved on the back of better cost management for IT stocks.

Foreign portfolio investors or FPIs were net buyers of Rs.1879 crore while domestic financial institutions or DFIs sold Rs.2370 crore on Wednesday. Global investors till date have pumped in nearly Rs.155,000 crore into equities in the last 75 days and that momentum only appears to continue building in Indian markets.

There are really not too many global cues with markets slightly uncertain about the impact of the Trump impeachment and the follow up process. On Wednesday, the Dow closed flat and the NASDAQ was up just about 40 bps. In addition, there was lacklustre trading across Europe. The SGX Nifty is about 20 bps in the green and not too conclusive.

The Trump impeachment initiated by the US Congress and supported by Democrats is a serious issue as there is no precedent. Even Nixon had resigned ahead of his impeachment. It is surely going to roil the markets in the coming days and that remains one major event risk that markets need to contend with. Sensex 50,000 will happen once the cloud clears.

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