Fortunately, India is not currently in the volatile position of 2013, when the Fed began tapering to normalize quantitative easing after the 2008 financial crisis. India was listed as one of the most vulnerable countries to tapering consequences under the “vulnerable 5” economy in 2013, but India now appears to be in a better position to tackle onslaught. is. The country’s foreign exchange reserves have more than doubled since 2013, a record high of over $ 640 billion.Several other indicators that determine financial vulnerabilities such as external debt As a percentage of GDPConsumer inflation and current account deficits are also in good shape compared to 2013, indicating that India may no longer be vulnerable.
Lack of vitality can be attributed to the recording of profits, as the tapering is unlikely to cause a noticeable decline in the stock market. India is one of the highest performing emerging markets of the year, and many international brokerage firms have stated that India’s stocks are currently high and investors are becoming more cautious. This, coupled with better opportunities in the primary markets and inflation concerns, seems to be the driving force behind hesitation in the secondary space. However, investors need to be careful as the Fed begins to taper and short-term corrections may be prioritized as liquidity begins to run out.
This week’s event
The automotive sector is in the limelight this week, with expectations for normalization and potential upturns. Nifty Cars, which had been sluggish compared to the Nifty50, rose 0.35% this week and the Nifty50 decreased 1.87%. Management commentary from several automakers also shows that the worst of semiconductor shortages is over and their future outlook appears to be underpinned by unabated demand and improved supply chain conditions. Is shown. Optimism among automakers seems reassuring, but inflation may continue to hurt their margins. Therefore, investors can tactically bet on this sector against companies with high profit and margin visibility, in addition to a resilient balance sheet.
Nifty50 closed the deal this week with a strong bearish candle. During the week, the index tried to exceed 18,120, but failed due to rising selling pressure. Higher levels may not last, given the weakness of the market. The Benchmark Index is currently trading around 17,700 key support levels. Similarly, Bank Nifty trades around support for the uptrend line. Traders are encouraged to maintain a mild bearish to neutral outlook in order to position the trade. Below 17,700, the benchmark may test 17,500 levels.
Expectations for this week
At the end of the resulting season, D-Street looks for clues from international factors to determine its move. In the absence of a positive trigger, the index is expected to continue to be under pressure as the market accepts a “rising sell” mood. Next week, stock-specific movements will be more common than market-wide movements. As global macros continue to dominate, investors should take a selective approach rather than observing FII activity to assess sentiment and challenge aggressive trading. Nifty50 ended the week at 17,764.80, down 1.87%.
Nifty: Should I blame Tapered Tram 2.0 for making Nifty fragile?
https://economictimes.indiatimes.com/markets/stocks/news/should-you-be-blaming-taper-tantrum-2-0-for-making-nifty-fragile/articleshow/87812204.cms Nifty: Should I blame Tapered Tram 2.0 for making Nifty fragile?