Market Outlook February: With the Budget blues behind us, the government’s much applauded move to maintain fiscal prudence despite increase in capital expenditure and reduction of government borrowings should set a positive undertone for the domestic markets and bring FII inflows. Higher allocation towards farmers, rural population, youth should boost consumption and revive the demonetized economy. All eyes will now be glued at RBI’s monetary policy which will be unveiled on Feb 8, 2017 and upcoming state elections.
On the global front, European Central Bank (ECB) meeting minutes, Bank of England’s (BOE) monetary policy and US FOMC meeting minutes will be major events to watch for. Political climate in developed countries that are moving towards protectionism may impact global trade and hence export related sectors should be viewed with caution. Though Indian markets cannot be seen in insolation in light of global uncertainties, yet they are better placed than other emerging market peers. Hence, we recommend investors to invest in stocks with strong fundamentals for long term perspective.
In this issue:
- Movers & Shakers
- Market Outlook
- Union Budget 2017–18: Brief Analysis
- Technical Picks
- Auto Sector January Sales
- Commodity Pick
- Mutual Fund Commentary & ELSS
- Key Financial Events – Feb
Nifty Technical Outlook: On the monthly chart, we are observing that the preceding up move has taken support at the 50% Fibonacci retracement levels and has formed a bull candle. This clearly suggests that monthly bias has turned positive and momentum on the upside is likely to continue. In the coming month if Nifty trades and closes above 8664 level then it is likely to test 8822 – 8979 – 9162 levels. However, if Nifty trades and closes below 8457 level then it can test 8300 – 8143 – 7960 levels.
Since, the monthly bias has turned positive we expect momentum on the upside to continue and Nifty may test the above mentioned resistance levels. Further, stock specific activity viz. in the midcap and small-caps is likely to continue.
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