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Below is on Weekly Market Outlook 11 February 2023 By Vinod Nair, Head of Research at Geojit Financial Services

Domestic indices ended the week along the flatline with a negative undertone as the market sentiments were hammered by the prospects of a policy tightening by the Fed as a strong job market in the US offers more leeway in enacting stricter policy measures. FIIs continued to lower investor confidence while significant support from DIIs provided the domestic market with a cushion of comfort. The RBI’s MPC meeting during the week delivered a smaller rate hike in line with market expectations, which was positively welcomed by investors. They have taken a more optimistic view on domestic growth by increasing the GDP forecast while cautiously keeping CPI inflation at 5.3% for FY24. During such shaky times, investors need to adopt value buying as a strategy. Due to a decrease in valuation near long-term averages, small cap companies are looking appealing over the long term. Going ahead, markets await the release of key inflation numbers for a clear direction and to gauge the strength of the economy.

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