Indian stock markets showing signs of recovery: Experts

Business Thursday 18/April/2024 07:25 AM
Indian stock markets showing signs of recovery: Experts

New Delhi: The Indian stock market anticipates a shift in sentiment as investors have accounted for the delay in Federal Reserve rate cuts. Market participants are hopeful that global pressure on Israel will result in a more moderate response in the market. With these factors in mind, observers are monitoring market dynamics closely for any signs of change.

"In India, we expect better market sentiment as the Fed rate cut delays are fully factored in and the hope is that global pressure on Israel will lead to a more moderate response" said Ajay Bagga, Stock market expert.

He further highlights that "Corporate earnings are returning to center stage as markets recover from three days of geopolitics and Fedspeak induced falls. US Treasury yields are down, Brent is below $ 90 and the US dollar is slightly weaker than its 5-month high level hit on Tuesday".

After three days of volatility fueled by geopolitical tensions and Federal Reserve statements, markets are showing signs of recovery.

The Dow Jones index rose to 37,865.35 in Wednesday's trading session while the S&P also gained to 5075.77 after the opening. While in the Asian market, Japan's Nikkei 225 index lost 1.32% to close at 37,961.80 at the end of the trading session.

US Treasury yields have experienced a decline, while Brent crude oil prices have dipped below $90 per barrel. Additionally, the US dollar, albeit slightly weaker, remains close to its five-month high level reached earlier this week.

According to market experts, the Powell's remarks, coupled with existing market expectations of prolonged higher interest rates, have prompted a resurgence in dip-buying activity.

However, the market's recovery may be tempered by ongoing geopolitical risks, particularly the potential for Israeli reactions to developments in Iran. Any escalation in this conflict could have broader implications, posing risks to market stability.

As attention shifts towards corporate earnings, investors remain vigilant, monitoring both geopolitical developments and earnings reports for insights into market direction.