Indian stock markets struggled for gains today as investors remained cautious despite some easing of Ukraine crisis. The Sensex was up 150 points while Nifty edged higher to near 17350 levels. Selling pressure eased in other Asian markets after the U.S. Secretary of State agreed to a meeting with Russia’s foreign minister, raising hopes of a solution to the standoff over Ukraine.
US Secretary of State Antony Blinken has accepted an invitation to meet with Russian Foreign Minister Sergei Lavrov late next week provided Russia does not invade Ukraine, the U.S. State Department said.
Analysts will be watching if Nifty will be able to overcome selling pressure at higher levels.
“The index continues to face resistance at higher levels. The Nifty is getting nervous around 17400-17500. We need to get past this patch on a closing basis for the short-term trend to turn positive. The market has support at 17200 and if we break that on a closing basis, we could drift towards 16800,” said Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments.
Concern about conflict in Ukraine comes with markets already rattled by expectations of aggressive rate hikes by the Federal Reserve. Foreign investors have sold a net $6.41 billion in Indian equities so far this year, compared with net purchases of $5.82 billion in the same period last year. Investors also fretted over inflationary risks and higher costs affecting the performance of companies.
“The roller coaster ride in the market will continue till some clarity emerges on the Ukraine issue. Since it is difficult to predict the outcome of this crisis, investors may follow a wait and watch strategy for the short run. The more enduring headwind for the market this year would be monetary tightening by the Fed.Back home, in India inflation is under control and credit growth is expected to pick up to double digits. This augurs well for financials,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Among the Sensex stocks, HDFC, L&T and Tata Steel were among the top gainers, up between 1% and 1.5%. Wipro and Infosys were among the laggards, down around 0.5%.
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