Synopsis
The market outlook for the coming week in Mumbai will be influenced by auto sales, PMI, and FIIs data, along with global tariff developments and geopolitical risks. Experts suggest that current market corrections may present future buying opportunities.Key Takeaways
- Focus on auto sales and PMI data.
- FIIs data will be crucial.
- Global tariff changes may impact markets.
- Historical trends indicate buying opportunities during corrections.
- Long-term investment strategies are vital.
Mumbai, March 1 (NationPress) The market forecast for the upcoming week hinges on auto sales, PMI and FIIs data, as well as global elements such as tariff fluctuations and geopolitical uncertainties, as explained by an expert on Saturday.
Historical corrections -- during Lehman’s collapse, the Taper Tantrum, demonetisation, or the Covid-19 pandemic -- have consistently turned out to be strong buying opportunities in hindsight, according to the market expert, even as the Indian stock market faced a significant correction this week.
As stated by Krishna Appala, Senior Analyst at Capitalmind Research, “the current market downturn may feel distressing, but history indicates that years later, it could lead to a significant upturn.”
This past week, the benchmark indices fell more than 3 percent due to widespread selling activity.
Concerns about an escalating trade war and apprehensions regarding a slowing US economy triggered selloffs across major sectors, including IT, auto, and various stocks.
The US is set to enforce a 25 percent tariff on imports from Canada and Mexico starting next week, in addition to a 20 percent tariff on Chinese products. This announcement unsettled global markets, resulting in a nearly 2 percent drop in key Indian indices on Friday.
“Over the last 30 years, markets have experienced declines of over 20 percent in several years, yet they ended positively in 22 out of those 30 years,” Appala remarked.
The expert highlighted that phases of sharp declines are frequently succeeded by significant recoveries, and maintaining a long-term investment perspective has historically proven successful.
“Market discipline is crucial during challenging times, just as it is during prosperous ones. Achieving long-term returns isn’t a linear journey -- it encompasses periods of substantial drawdowns and quick recoveries,” he emphasized.
On Monday (Feb 24), the Sensex plummeted by 857 points to close below 74,000, while the Nifty decreased by 242.55 points, finishing at 22,553.35.
Despite a slight recovery on Tuesday (Feb 25), when the Sensex gained 147 points, the Nifty continued its declining trend, falling for the sixth consecutive session.
Investors remained wary ahead of the monthly derivatives expiry, resulting in a mixed market performance on Thursday.
While financial and metal stocks experienced gains, auto and capital goods stocks faced pressure. The RBI’s decision to reduce risk weights on bank financing for NBFCs and microfinance loans provided some support to stocks like Shriram Finance, Bajaj Finserv, and Bajaj Finance.
However, on Friday, the domestic benchmark indices fell by nearly 2 percent.
The Nifty concluded at 22,124.70, down 1.86 percent, while the Sensex settled at 73,198.1, losing 1.90 percent.
