InvestorQ : What is your view on the Nifty and Sensex for 17 March? Why is the index correcting daily from higher levels?
Anamika Sodhani made post

What is your view on the Nifty and Sensex for 17 March? Why is the index correcting daily from higher levels?

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diksha shah answered.
5 months ago
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You are right because Tuesday was the third consecutive day when the Nifty and Sensex gave hope to the markets but failed to hold on to higher levels. IN fact, on Tuesday the market started out strong and held gains through most of the day. However, towards the last couple of hours of trade Sensex lost 487 points to close in the negative zone.

There is another trend that is visible in the last few days. Clearly, there appears to be a preference for defensive plays like IT stocks and FMCG stocks all over again. To an extent, this is understandable in the midst of the rising uncertainty in the market at higher levels. We need to see how the markets react on Wednesday to the FOMC outlook.

After a long gap, the foreign investors were back in positive action on Tuesday. The FPI flows were positive on Tuesday with net buying of Rs.1692 crore although domestic institutions and mutual funds sold Rs.1169 crore of equities. The FPI trend showed a marked change on Tuesday after overall selling of Rs.8500 crore in 2 weeks. However, it is too early to call.

Markets have been tentative with the US and the European markets bereft of direction ahead of the FOMC meeting outcome on Wednesday. Markets will need some time to digest the implications of the FOMC move and we could start seeing the impact soon. Indian markets should be OK as long as there are no signs of tightening, which looks unlikely.

Coming back to your question of why index is currently selling off at higher levels, it looks like most of the immediate triggers in the market are already in the price and perhaps a clear policy from the US government on its response to rising yields will be the answer. Till them the markets may remain uncertain and we may have to wait till end of 17 March.
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