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Quote on Morning market 02 August  2022 By Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

"The market message from the sharp decline in the US 10-year bond yield to 2.57% from the recent high of 3.27% is that the Fed is nearing the end of its tightening cycle with only one more large hike in September and small hikes thereafter taking the terminal rate to around 3.5%.

This has facilitated the rally in global markets with India emerging as one of the best performers. There is a consensus that India will be the fastest growing large economy in the world this year and next with the least vulnerability to a global growth slowdown. This, and the dollar index dipping to below 106 from the recent high of above 109, have paved the way for the return of FIIs who have turned consistent buyers now. The 2100 point rally in Nifty from the June lows has pushed the market into overbought territory with rising valuations. Markets are likely to consolidate in the near-term. Capital goods and autos (the PV and CV segments) are on a strong wicket."

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