Will Ceasefire & FPI Inflows Lift Markets this Week?
Despite the Sensex’s 1,047-point fall last week, there are signs that the Indian stock market may rebound this week. The ceasefire in the Ukraine-Russia conflict and the return of foreign portfolio investors (FPIs) are expected to boost market sentiment. Additionally, strong Q4 results from Indian companies and easing tariffs offer hope for a recovery. In this blog post, we’ll explore these factors and what they mean for the Indian stock market.
Ceasefire in Ukraine-Russia Conflict
The ongoing conflict between Ukraine and Russia has been a major concern for global markets. The recent ceasefire agreement between the two nations may bring some relief to the market. The ceasefire is expected to reduce tensions and prevent further escalation of the conflict, which has the potential to impact global trade and economies.
Foreign Portfolio Investors (FPIs) Return
FPIs have been a major source of strength for the Indian stock market in recent years. They have been attracted to India’s strong economic growth, stable financial system, and attractive valuations. After a brief withdrawal in recent months, FPIs are expected to return to the market. This could lead to an increase in buying pressure and support for the Sensex.
Strong Q4 Results
Indian companies have reported strong Q4 results, which are expected to boost market sentiment. Many companies have beaten earnings estimates, and some have even reported higher-than-expected revenues. This could lead to an increase in investor confidence and support for the market.
Easing Tariffs
The Indian government has announced plans to ease tariffs on certain goods, which is expected to boost consumer spending and economic growth. This could lead to an increase in demand for goods and services, which could support the market.
Travel and Tourism Industry
The travel and tourism industry was hit hard by the Ukraine-Russia conflict, with many tourists cancelling their trips to India. However, if the ceasefire holds, this industry could recover quickly. Many tourists were waiting for the situation to stabilize before making travel plans, and if the conflict dies down, they could return to India.
Currency and Reserves Data
Recent currency and reserves data have been encouraging, indicating that the Indian economy is stable and resilient. The country’s foreign exchange reserves have been rising, and the rupee has been strengthening against major currencies. This could lead to an increase in investor confidence and support for the market.
What to Expect this Week
Given these positive factors, the Indian stock market may rebound this week. The Sensex could rise to 50,000-52,000 levels, and the Nifty could touch 14,500-15,000 levels. However, investors should be cautious and not get carried away by short-term gains. The market is expected to be volatile, and investors should focus on long-term growth and fundamentals.
Conclusion
In conclusion, the Indian stock market may rebound this week due to the ceasefire in the Ukraine-Russia conflict, the return of FPIs, strong Q4 results, easing tariffs, and encouraging currency and reserves data. However, investors should remain cautious and focus on long-term growth and fundamentals. The market is expected to be volatile, and investors should be prepared for short-term fluctuations.
Source:
https://www.thecore.in/podcasts/markets-set-to-edge-up-on-ceasefire-moves-835131
