InvestorQ : What is your view on the markets for 26 March after the sharp correction seen in the Nifty and Sensex for last 2 days?
Dhwani Mehta made post

What is your view on the markets for 26 March after the sharp correction seen in the Nifty and Sensex for last 2 days?

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diksha shah answered.
4 months ago
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The steep correction in the markets continued on Thursday. In fact, after the 871 points correction on Wednesday, the Sensex followed it up with another 740 points correction. In the process, the total market cap loss was to the tune of nearly Rs.710,000 crore in 2 days. The sell-off only got pronounced on F&O expiry day as there was a rush to close positions.

Even as there was a rush to cover long positions on the F&O expiry day, the good news is that the markets are a lot lighter as arbitrage positions also got wound up. The test for the markets will be if fresh positions get built in the new series. The other worry is that the A/D ratio is sharply negative at around 5:45 and the VIX is back to 23 levels.

FPI action was once again negative on Thursday with net selling of Rs.3384 crore largely on the back of unwinding of longs ahead of month end. However, to compensate for the FPI selling, the domestic institutions bought Rs.2268 crore of equities. FPIs are now close to being net sellers in equity, although the selling in debt has bene quite sharp.

Globally cues were broadly supportive. There was some respite for the US markets with the Dow and the NASDAQ closing Thursday in the positive but other markets in Europe were not all that supportive. Europe was rather mixed and Asian cues are positive for Friday and the SGX Nifty is also up 60 bps in early trades.

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