Mr Mitul Shah, Head Of Research at Reliance Securities.
Indian equities closed higher despite weak global markets and RBI repo rate hike earlier in the week. Nifty was up 0.7% while broader markets underperformed compared to the main indices as Nifty Mid-Cap and Nifty-Small Cap increased 0.5% and 0.2% respectively. Most sectoral indices ended in green. Nifty Pharma witnessed the highest gained at 1.2%, followed by Nifty IT which was up 1%. Nifty Metal was the major laggard which declined 1.3%.
U.S. equities closed lower as investors remain concerned about the global economy while awaiting on key data about inflation. The S&P 500 fell 1.1%, the Dow Jones lost 0.8%, while the technology-heavy Nasdaq slipped 0.7%. 10-year Treasury note rose to 3.028%, up from 2.969%. The combination of slowing growth and rising prices has raised the concerns of stagflation where growth stalls but inflation drives up prices. Moreover, the Russia-Ukraine crisis continue to impact market sentiments.
Investors are still attempting to gauge the market's trajectory as global markets have also remained volatile due to FED's upcoming policy decisions and the Russia-Ukraine crisis which is affecting supply chain and logistics. RBI is looking at another phase of coordinated action between fiscal and monetary authorities. After RBI, US Fed also expecting rate hike in the coming weeks. The primary focus will be on central banks' policy measures to stabilize inflation. Changes in oil prices and amendments to import and export duties might play a role in assessing the movement of the market next week. The continued selling by FIIs and plunging rupee are likely to have economic implications in the near term. Globally, the Russia-Ukraine crisis and supply chain disruptions continue to impact global and Indian equities.