Having suffered a triple blow of recession fears in the US, inflationary pressure and the Fed’s rate hike, headline index Sensex lost 2,943 points this week. The broader Nifty50, which ended below the 15,300 mark, is now just 411 points away from entering the bear zone officially. Data shows that it was the worst week for the Nifty in over two years.
As the indices recorded the sixth consecutive day of losses with several bluechips like
, HDFC twins, , and ending at fresh 52-week lows, investors are wondering whether we are close to the point of maximum pessimism in the market.
“The central bank bull market has ended and now we are having a central bank bear market. The central bank bear market ends when Jerome Powell comes and says now I am through with the hiking cycle and I am going to stop hiking or I am going to do quantitative easing,” veteran fund manager S Naren of
AMC said.
Top investor Atul Suri, on the other hand, is waiting for Nifty to hit 14,500 before betting everything in hand. He is bullish on defence stocks, bearing stocks, select FMCG plays, engineering infra and capex plays.
“The domestic market will continue to trade with high volatility in the near term, however, the ongoing corrections are opportunities in disguise for medium to long-term investments,” Vinod Nair, Head of Research at
, said.
Foreign investors have already sold stocks worth around Rs 1.9 lakh crore so far in 2022. FIIs are also expected to maintain their selling spree with the central banks’ policy tone pointing towards continued rate hikes of higher magnitude.
Technical analysis shows that the market has been in a sharp down trend over the last 14-15 sessions. “Minor consolidations or small upside bounces have resulted in a sharp weakness as of now. Hence, any upside bounce from here could be a sell on rise opportunity for the short term,” said Nagaraj Shetti, Technical Research Analyst, Securities.
On the higher side, the area of 15,600 levels (mid part of Thursday’s long bear candle) is expected to be a crucial overhead resistance ahead and is unlikely to be broken on the upside in a hurry. After a small upside bounce, the Nifty could slide down to the 15,000-14,800 levels in the near term.
If Nifty hits 14,882 mark, then it would be regarded as a bear market. However, a slip below the 15,000 mark is also a key psychological level to watch out for.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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