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The rally in global markets, driven by the US economy’s soft landing narrative, appears to be losing steam, says V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

The major headwinds for the markets now come from the rising dollar and bond yields.

The US 10-year bond yield at 4.25 per cent is a major headwind for equity markets since this risk-free return is hugely attractive particularly when CPI inflation in the US is down to 3 per cent. The FPI selling in the cash market in August so far is likely to continue, going forward, he said.

Since the developments in the US economy are the main influences on the market, all eyes will be on the Fed chief Jerome Powell’s speech at the Jackson Hole Symposium on Friday.

Long-term investors can use market corrections to slowly accumulate high quality growth stocks particularly in banking, capital goods and automobiles, he added.

BSE Sensex was up 234 points in trade at 65183 points on Monday morning.

The top gainers are Bajaj Finance up by more than 2 per cent, Powergrid, NTPC, Wipro, JSW Steel, Kotak Mahindra, Tata Motors, Bajaj Finserv up by more than 1 per cent.