Hello reader, hope you’re doing well.
In sync with the commemoration of International Yoga Day, the financial market is gradually expanding in both directions, exhibiting a balanced state without any significant fluctuations in either direction. Nevertheless, the overall trend in the market is upward. It is crucial to comprehend that this upward momentum is not limited to a single country but is a global phenomenon, with various markets such as the United States, Euro Zone, Japan, South Korea, and Taiwan hovering near their 52-week highs. India, in particular, is approaching new record highs. This bullish sentiment pervades the global markets, even in the face of sluggish global economic growth.
The reason behind this optimistic trend can be attributed to the fact that the anticipated US recession, which the markets had factored in last year, did not materialize. In fact, there are indications suggesting that the US might manage to evade a recession altogether. Consequently, the markets are now adjusting their previous misjudgment from last year. Meanwhile, in India, there is significant activity taking place in mid and small-cap stocks, and this trend is expected to persist. Despite relatively high valuations, there is still value to be found in large-cap banking stocks, which have experienced corrections in their prices. Favorable leading indicators, particularly the sustained credit growth, bode well for high-quality banking stocks.
However, there exists a significant cause for concern among the bullish investors, stemming from the disappointing performance of the monsoon season, which has exhibited a deficiency of over 50% as of June 15th. The upcoming testimony of the US Federal Reserve Chairman before the US Congress later today has become the focal point of attention for market participants. Although the Federal Reserve has indicated that it has not concluded its interest rate hikes for the year, other negative factors such as declining crude oil prices due to sluggish demand from China and other economies might trigger apprehension among investors moving forward.
Nevertheless, based on the analysis of technical indicators, both the Nifty and Bank Nifty indices are projected to maintain a positive bias as long as they remain above their major support levels of 18,651 and 43,300, respectively.
As always, risk management is key, and a proper system in place prevents one from losing out too much, in case of outlier events. Have a good trading day, and may the force be with you!
Disclaimer: this post is for educational purposes only, we are not SEBI registered analysts. Trades mentioned here are not trade recommendations. Equity Investments are subject to 100% market risk, please consult your financial advisor before investing.
Really liked today’s. I guess it spoke more than numbers.