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Nifty To Top 16,600 on US Fed Member’s Conciliatory Tone

Nifty To Top 16,600 on US Fed Member’s Conciliatory Tone

After Friday’s fury, bulls are likely to come back with a vengeance on Monday, as Dallas Federal Reserve President Robert Kaplan said on Friday that he might need to adjust that view if the Delta variant of the coronavirus slows economic growth materially. According to global media reports, Kaplan was among the US central bank’s most forceful supporters for starting to reduce support for the economy.

“In the absence of key domestic economic data points and awaiting its release, the market is expected to continue its focus on global events to gain momentum. Global rise in covid cases is also a cause for worry, keeping the volatility high,” said Vinod Nair, Head of Research at Geojit Financial Services.

Analysts said that this being the August series settlement week on the NSE, markets are likely to see volatility and advise caution on individual stocks.

Following his statement, global stocks bounced back as investors believed the easy money policy would continue for quite some time.

Clues from SGX Nifty indicate that Nifty is likely to witness a gap-up opening of 150 points. The SGX Nifty is currently hovering around 16,623, much higher than the Nifty future’s Friday close of 16,433 (August) and 16,467 (September).

The US stocks on Friday closed higher with Dow Jones and S&P 500 rising 0.65 percent and 0.8 percent respectively; the tech-focused Nasdaq too climbed 1.1 percent.

Tracking the global sentiment, markets across the Asia-Pacific region such as Japan, Taiwan, Korea, and China jumped over one percent. Australian markets are up only marginally.

With settlement in F&O monthly contracts ahead, volatility to rise, they cautioned.

According to Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities, markets were broadly satisfied with the conclusion of the Q1-FY22 earnings season, as Nifty 50 Index EPS estimates witnessed moderate upgrades. With result season behind, the markets will likely keep a tab on domestic and global data, including Central Bank policy measures, inflation, commodity prices, and COVID-19 cases.