SGX Nifty hints that bulls may start with fresh energy!

As the saying goes, ‘All good things must come to an end’, the exuberant rally of the Indian markets finally halted on Thursday. The markets kicked off the sessions on a pessimist note on the back of weak global markets, which resulted in a profit booking across major sectors. Nifty Media, Nifty PSU Banks, and Nifty Auto, which were seen, outperforming the markets in the last couple of days, also came under bears’ attack. However, in the end, the markets trimmed their losses and ended with a modest loss.

Friday is a new day and the bulls are expected to start with fresh energy. SGX Nifty is indicating a positive start as it was trading up by 10 points at 13,534 levels. However, we believe that consolidation could be the theme of the day with stock-specific movement, as markets in the recent past have run up too much, too fast; so, a healthy consolidation is likely to take place and it may continue its rally post a required consolidation.  

The market participants would keep a close eye on industrial production data, which is scheduled to release today. Besides, in the near term, along with this data, the development on the vaccine front, may dictate the further trend of the markets.

The Asian indices were seen trading mixed on Friday, following mixed cues overnight from Wall Street as the rising Coronavirus cases and a stalemate over a new stimulus in the US weighed on investors’ sentiments. Japan’s Nikkei 225 was down by 0.54 per cent and China’s Shanghai Composite dipped 0.15 per cent. Meanwhile, Hong Kong’s Hang Seng has added 0.52 per cent.   

On Thursday, the US stocks closed on a mixed note. The tech-heavy Nasdaq added 0.5 per cent, while Dow and S&P 500 ended down by 0.2 per cent and 0.1 per cent, respectively. The persistent ambiguity on the US fiscal stimulus and a steep rise in the first-time claims for the US unemployment benefits pushed the market participants on the back foot.

European indices too finished the day on a mixed note as the market participants digested European Central Bank (ECB) monetary policy announcement. ECB has declared that it will enhance the size of its Pandemic Emergency Purchase Programme (PEPP) by 500 billion euros to 1.85 trillion euros and prolonged the PEPP by nine months to at least the end of March 2022.