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Below is the Daily Market Commentary 09 May 2022 By Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd

Indian equity continued with its sell-off in line with global peers on the back of slowing economic growth and rising inflationary concerns. Further, USDINR touched all-time low which added to the overall pressure. Nifty opened gap down but recovered later to finally end the day with loss of 109 points (-0.7%) at 16,302 levels. Market breadth was weak with Nifty Midcap  100 down -1.8% while Nifty Smallcap 100 was down -2.1%. Except IT, all other sectorial indices ended in negative territory with Media, Metals, PSU Banks and Oil & Gas losing more than 2%. IT on the other hand witnessed some bounce back momentum.

Global cues were weak amidst concern over aggressive monetary tightening by Central Banks to overcome soaring inflation which could slow down the economic growth. Further Covid induced lockdown in Shanghai and China’s slowest export data since June’20, further dampened the sentiments.

A couple of domestic and global factors have led to ~10% correction in Nifty over last one month. The weakness is likely to persist till the concerns over inflation, rising interest rate, and prolonged Russia-Ukraine war subsides. Technically till Nifty holds below 16400 zones, bounces could be sold for the downside move towards 16000 zones. This week, focus will be on the inflation number that will be released on the domestic front as well as from the US. While the primary market struggling with volatility, we are witnessing lot of action in the primary market. While India’s largest IPO of LIC successfully closed on Monday, three more offerings will hit the market this week including Delhivery, Prudent Corporate Advisory Services and Venus Pipes and Tubes.

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