New Delhi: Indian stock indices started Tuesday’s session marginally in the green, bucking the trend from the previous session where they declined substantially due to profit booking and volatile global markets.
Ease in domestic retail inflation also somewhat supported the indices today.
Retail inflation in India eased in January to 5.10 per cent on an annual basis compared to a four-month high of 5.69 per cent in December. The retail inflation in India though is in RBI’s 2-6 per cent comfort level but is above the ideal 4 per cent scenario.
At 9.41 am, Sensex was at 71,192.75 points, up 120.26 points or 0.17 per cent, while Nifty was at 21,631.15 points, up 15.10 points or 0.070 per cent. Among the widely-tracked Nifty 50 companies, 25 advanced and the rest 25 declined at the time of filing this report.
At 10:15 am, Sensex was trading 424.09 points higher at 71,496.58, whereas Nifty was trading 98.20 points up at 21,714.25.
Continued selling of Indian stocks by foreign portfolio investors coupled with high stock valuations, however, are concerns for the investors.
“An important ongoing trend in the market is the weakness in the broader market with sharp cuts in many mid and small caps. Many such stocks driven up by speculative buying without consideration for the fundamentals are correcting,” said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
“This trend is likely to continue since many such stocks are excessively valued,” Vijayakumar said.
“The explosive growth in the number of demat accounts and the newbies chasing mid and small caps influenced by recency bias have contributed to this froth in the broader market. A correction in this segment is inevitable and desirable. Correction will give opportunities to buy fairly valued stocks in this segment like PSU Banks,” he added.
Foreign portfolio investors have been aggressively selling Indian stocks, turning net sellers in the Indian equity market so far in 2024, after making a beeline to accumulate domestic stocks during November and December.
After selling stocks worth Rs 25,744 crore in January they have so far sold Rs 2,744 crore in February.
(With inputs from ANI)
