Positive Sentiments: Valuations to attract interest in equities
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Attractive valuations are expected to induce positive buying sentiment into the Indian equity indices during the upcoming week.
Besides, stock specific buying interest in energy, pharma and media stocks will support the market's upward trajectory.
However, fiscal year-end considerations as well as risk emanating from geo-political developments will likely arrest any sharp up moves.
"Most of the sectoral indices are in uptrend and giving positive signals. Leading from the front are the 'Energy, Pharma and Media' indices. Bank Nifty is near the supports and could bounce back next week," said Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities.
"Barring any untoward incident in geo-political arena, positive patterns seen in the Mid cap and Small Cap indices augurs well for the overall health of the markets."
On Friday, the benchmark indices ended with modest losses amid profit booking after the last week's rally.
Furthermore, the overall market sentiment was negative due to the ongoing Russia-Ukraine conflict.
Consequently, the NSE Nifty50 declined by 0.8 per cent and the S&P BSE Sensex fell 0.9 per cent for the week.
As per provisional figures, FIIs were net sellers of Rs 5,344 crore in the equity markets and DIIs were net buyers of Rs 2,821 crore.
"We are witnessing outflows from Indian markets, it appears to be a part of profit booking or rebalancing and hence does not appear to be a major cause of concern," said Likhita Chepa, Senior Research Analyst, CapitalVia Global Research.
"With the economy returning to normalcy, in line Q3 results of various companies and demand returning to pre Covid levels across sectors, we expect the broader outlook of the Indian markets to remain constructive."
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services, said: "Nifty has been moving within the 17,000-17,400 band for last six days with some selling pressure visible at higher levels. Overall, we remain positive on the market and expect it to gradually move towards 17600-17750 zones in near term.
"Also strength in heavyweight sectors like 'Metals, Energy, IT and Media' are supporting the market."
