Following the US Fed’s hawkish minutes, which indicated policymakers reinforced the need for further rate rises, major benchmark indexes began somewhat quiet on Thursday, reflecting losses on global markets. The NSE Nifty50 remained at 19,403, while the BSE Sensex dropped 12 points to 65,434.
Losses among the two indexes were led by Eicher Motors, Tata Steel, Indusnd Bank, Maruti, and Hindalco, which fell up to 1%.
On the other hand, the top frontline gainers were Britannia, Power Grid, Nestle, Ultratech Cement, Asian Paints, and M&M.
The larger markets kept doing better. Compared to a relatively flat BSE Sensex index, the BSE MidCap and SmallCap indexes increased up to 0.4%.
“An noteworthy trend in the market is the spike in retail investor activity,” said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. “This is seen by the huge rise in new demat accounts (2.36 million) created in June. Peaks in rallies are often when new retail investors join the market bandwagon. This should serve as a warning.
The rise spurred by FPI liquidity seems to be fading. Some leading signs, such as loan growth during the first quarter from major financial institutions like the newly merged HDFC Bank, point to a potential downturn in the economy. Sales of two-wheelers in June show that demand is still an issue in rural regions. Briefly put, the macroeconomic backdrop, although positive, is not sufficiently optimistic to justify continuing the advance, which has already gotten a little ahead of fundamentals, he said.
At this point, investors shouldn’t go after low-quality small-cap companies. Keep your money in high-quality large-cap stocks. He said, “Wait for the Q1 results for guidance.”
World cues
On Thursday, Tokyo stocks began lower, continuing losses on Wall Street as minutes from the Federal Reserve’s June meeting hinted at further interest rate increases.The broad Topix index down 0.53 percent, or 12.18 points, to 2,293.85, while the benchmark Nikkei 225 index was down 0.83 percent, or 277.77 points, at 33,060.93 in early trading.
As investors analyzed the minutes from the most recent meeting of the U.S. Federal Reserve and prepared for crucial economic data in the coming days, Wall Street’s major indexes concluded the day with small falls on Wednesday.