Friday, March 29

Earnings worries also on Dalal Street’s mind


Mumbai: The stock market could be weighed down this week by the disappointing earnings from Infosys and HDFC Bank, resumption of foreign selling and concerns over rising US bond yields. In the previous truncated trading week, overseas investors sold both stocks and debt, as yields on domestic bonds climbed amid a hawkish tone in Reserve Bank of India’s monetary policy.

Analysts said rising bond yields do not augur well for equities. Equity market valuations are now most stretched versus debt markets in the last few years, according to CLSA.

Lower-than-expected earnings by Infosys and HDFC Bank announced over the weekend disappointed investors.

Infosys shares could see a 5-6% ‘gap down opening’ on Monday, while HDFC Bank may not fall more than 1-2%, said Siddarth Bhamre, research head at Religare Broking.

“Buyers would emerge in Infosys around ₹1,550-1,600. HDFC Bank’s numbers are not great but the stock hasn’t gone anywhere in the recent months so I am not expecting a big down move in the stock,” he said.

The Sensex and Nifty fell nearly 2% in the shortened trading week. Financials markets were shut on Thursday for Mahavir Jayanti and Dr Babasaheb Ambedkar Jayanti, and for Good Friday.

The Nifty ended down 54.65 points, or 0.3%, at 17,475.65 and the Sensex ended down 237.44 points, or 0.4%, at 58,338.93.

The Nifty is unlikely to fall below 17,350, said Rohit Srivastava, founder, Indiacharts.com. The index has fallen 3.2% since April 4, when it reclaimed 18,000 for the first time since January 18. The Nifty had touched a low of 15,671 on March 8.

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“After a knee-jerk reaction to Infosys numbers (on Monday), markets are likely to pick up momentum,” said Srivastava.

“We might not see Indian bond yields move up much more. The tech sector is showing weakness now but other sectors have already corrected in the weakness after October 2021 so strength from other sectors will provide support,” he said.

Foreign Portfolio Investors sold shares worth ₹2,061.04 crore on Wednesday while Domestic Institutional Investors bought shares worth ₹1,410.85 crore. This marked the sixth straight day of selling by FPIs of about ₹12,500 crore during the period.

Mumbai: The stock market could be weighed down this week by the disappointing earnings from Infosys and HDFC Bank, resumption of foreign selling and concerns over rising US bond yields. In the previous truncated trading week, overseas investors sold both stocks and debt, as yields on domestic bonds climbed amid a hawkish tone in Reserve Bank of India’s monetary policy.

Analysts said rising bond yields do not augur well for equities. Equity market valuations are now most stretched versus debt markets in the last few years, according to CLSA.

Lower-than-expected earnings by Infosys and HDFC Bank announced over the weekend disappointed investors.

Infosys shares could see a 5-6% ‘gap down opening’ on Monday, while HDFC Bank may not fall more than 1-2%, said Siddarth Bhamre, research head at Religare Broking.

“Buyers would emerge in Infosys around ₹1,550-1,600. HDFC Bank’s numbers are not great but the stock hasn’t gone anywhere in the recent months so I am not expecting a big down move in the stock,” he said.

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The Sensex and Nifty fell nearly 2% in the shortened trading week. Financials markets were shut on Thursday for Mahavir Jayanti and Dr Babasaheb Ambedkar Jayanti, and for Good Friday.

The Nifty ended down 54.65 points, or 0.3%, at 17,475.65 and the Sensex ended down 237.44 points, or 0.4%, at 58,338.93.

The Nifty is unlikely to fall below 17,350, said Rohit Srivastava, founder, Indiacharts.com. The index has fallen 3.2% since April 4, when it reclaimed 18,000 for the first time since January 18. The Nifty had touched a low of 15,671 on March 8.

“After a knee-jerk reaction to Infosys numbers (on Monday), markets are likely to pick up momentum,” said Srivastava.

“We might not see Indian bond yields move up much more. The tech sector is showing weakness now but other sectors have already corrected in the weakness after October 2021 so strength from other sectors will provide support,” he said.

Foreign Portfolio Investors sold shares worth ₹2,061.04 crore on Wednesday while Domestic Institutional Investors bought shares worth ₹1,410.85 crore. This marked the sixth straight day of selling by FPIs of about ₹12,500 crore during the period.

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