Domestic markets are expected to see a flat opening on Thursday, with a downward bias amidst mixed global cues. Today is the settlement day for derivate contracts on the NSE, so analysts expect individual stocks to see higher volatility. The market has been in consolidation mode in the last few days.
Siddhartha Khemka, Head – Research, Wealth Management, Motilal Oswal Financial Services Ltd, said: Easing geopolitical concerns and record highs on Wall Street lifted sentiment, while FPI inflows resumed after two months of selling pressure. US Federal Reserve minutes highlighted optimism about easing inflation and a resilient labour market, creating scope for gradual interest rate cuts. Investors now await key US economic data releases later today, including the second estimate of Q3 GDP growth, PCE inflation data, and initial jobless claims, which will provide further market direction.
However, Emkay Wealth Management expects time-wise corrections due to higher valuations.
Emkay Wealth Management, the wealth management and advisory arm of Emkay Global Financial Services, held a virtual media round on Wednesday. It is estimated that the Nifty EPS growth for FY25 will be 7.9 per cent. The team believes the current market valuations are in expensive territory and the market may witness some consolidation or a time correction. “Markets are likely to pick up once earnings growth shows up. According to Emkay Wealth, there are ample stock-specific opportunities in the current market. So, PMS, AIF and active fund managers should do well.” It added.
Gift Nifty at 24,320 against Nifty December future value indicates a marginal decline at open.
Meanwhile, JM Financial said India should capitalise on the US President-elect Trump’s tax proposal. “ As a part of his initial actions upon inauguration, President Trump said that he will levy tariffs on all imports from China, Mexico, and Canada (top 3 US import partners) on day one of his Presidency. This includes a 25% tariff on all goods from Mexico and Canada and an additional 10% tariff (above additional tariffs) on China. In 9MCY24, these three countries contributed 41.7% of USA’s total imports. Higher tariffs on China and relatively lower tariffs on India should provide a fresh lease of life to the ‘China + 1’ trade in chemicals, auto ancillaries, wires & cables, solar, solar cells & modules, tiles, and numerous other US exporting sectors from India,” it read.
The options market reflects balanced sentiment, with comparable call-and-put writing levels. The 24,500-strike call has amassed the highest open interest of 98.86 lakh contracts, while the 24,000-strike put shows considerable open interest at 95.15 lakh contracts, said SAMCO Securities. India’s VIX eased by 4.44% to settle at 14.62. The environment supports bullish sentiment with volatility levels remaining below 15, as lower VIX typically fosters buying interest.
