Positive Investor Sentiment Persists in Indian Market: Experts
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Synopsis
The Indian equity markets display a mixed performance with slight gains in major indices despite negative trends in mid and small caps. Positive sentiment from foreign investors emerges amid global uncertainties.
Key Takeaways
- FIIs turn net buyers after months of selling.
- Sensex and Nifty show marginal weekly gains.
- Market volatility decreases with India VIX dropping.
- Resistance levels identified at 23,600 and 24,000.
- SEBI's new regulations encourage foreign investments.
Mumbai, March 29 (NationPress) The Indian equity markets experienced a mixed week, with the Nifty 50 and Sensex 30 indices posting slight gains, while the BSE Midcap and Smallcap indices lagged behind, finishing in negative territory.
Despite unfavorable global signals and worries regarding impending US tariffs, the market saw positive sentiment from foreign investors. After a series of sell-offs in recent months, Foreign Institutional Investors (FIIs) have turned into net buyers in the last few sessions, analysts noted on Saturday.
On March 28, during the inaugural day of the new (April) series, the market faced volatility. The Sensex concluded at 77,414.92, down by 191.51 points (0.25 percent), whereas the Nifty settled at 23,519.35, down by 72.60 points (0.31 percent).
The market opened on a flat note and remained subdued during the initial half, but selling pressure in the automobile and IT sectors pulled the indices lower in the latter half. Nevertheless, last-minute buying activity enabled the Nifty to close above the 23,500 mark.
According to a report from Choice Broking, throughout the week, both the Sensex and Nifty gained over 0.5 percent each, contributing to a 6 percent increase for the month and a 5 percent rise in the financial year 2024-25.
In parallel, the India VIX fell by 5.31 percent to 12.5750, suggesting reduced market volatility. Open Interest (OI) data indicates resistance levels at 23,600 and 24,000, while strong support is found at 23,300.
A breakout above 23,800 could lead to further gains, and traders should monitor these levels closely to confirm the next trend direction, experts advised.
Manoj Purohit, Partner and Leader, Financial Services Tax, Tax and Regulatory Services, BDO India, stated that FIIs have begun to show positive inflows, bringing optimism back to the Indian market, even in the last week of the financial year, which is typically marked by significant profit booking.
“Additionally, a crucial announcement from SEBI during its Board meeting regarding the FPI community has boosted the FPIs. In response to feedback from major banks regarding the limitation of P-Notes trading volume, the previous threshold for detailed beneficial ownership disclosures was raised from Rs 25,000 crore to Rs 50,000 crore,” Purohit elaborated.
Overall, this is a timely decision from the capital market regulator as foreign investors adopt a cautious approach towards India. All eyes are now focused on upcoming US announcements regarding potential tariff restrictions and the possibility of a rate cut by the RBI in its review meeting.
