Macro factors will weigh on bourses

Mumbai: The benchmark indices witnessed lackluster activity this week, with Sensex closing at 60,682.

Among Sectors, Digital and Media indices rallied over 2 per cent whereas Metal, Energy and FMCG stocks witnessed profit booking at higher levels. Technically, the index took the support near 60,070 and reversed but it failed to close above 60,900, an important resistance mark.

Currently, Nifty is consolidating near 20 day SMA and it also formed inside body candle on weekly charts. The short term texture of the market is indicating continuation of non-directional activity in the near future.

"For the traders now, 60,900 would be the immediate breakout level to watch out, above the same the index could move up to 61,200 further upside may also continue which could lift the index till 61,700," says Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. On the flip side, fresh selloff possible only after dismissal of 60,350 below the same selling pressure is likely to accelerate. Below which the index could slip till 60,000-59,500. During this week, the benchmark BSE-30 was almost flat.

However, BSE Midcap and BSE Small-cap index saw positive gains during the week. Sector-wise, BSE Metal and BSE Power index witnessed sharp correction, whereas BSE Healthcare, BSE IT, BSE capital goods, and BSE Realty reported gains this week.

FPI flows in India remained negative. RBI monetary policy committee raised the repo rate by 25 bps and remained concerned about core inflation. International oil prices rose this week with Brent Crude now trading close to $86-87 per barrel. As the Q3FY23 result season comes towards

an end, the investor focus will now shift towards domestic and global macro factor, Chouhan said. Dr Joseph Thomas, Head of Research, Emkay Wealth Management, says, "The equity markets continued in the corrective mode after the Fed and the RBI announced further hike in the base rate. What was surprising was the firmer tone of both the central banks regarding inflation containment, as both sounded quite determined to hike rates again if data points favour the same."

The corrective downward movements would render the domestic markets less expensive in terms of valuations, and greater participation is expected of investors through graduated investments in the coming months, he addedThe trajectory of the US Dollar especially the Dollar Index is being tracked by investors and analysts alike to deduce the prospects for local currencies as it is crucial for overseas investors.