Pre Market Views - Nov 25, 2022 - Reliance Securities

U.S. markets were closed for the Thanksgiving holiday, it rally in the previous session following the release of the Fed minutes. Global stocks edged up in expectations of FED slowing the pace of interest-rate hikes going ahead. A key focus for the market is the Chinese government's response to rising Covid-19 cases, with the country now battling its worst outbreak of the virus. In Malaysia, the benchmark stock index rose 4%, the most since Mar'20, after opposition leader Anwar Ibrahim became prime minister. Malaysia's currency strengthened 1.8% against the dollar.

Domestic equities closed higher following positive global cues. The Nifty gained 1.2%, while broader markets under-performed the main indices as Nifty Mid Cap and Nifty Small Cap gained 0.5% each. All sectoral indices ended in green except Nifty Consumer Durables which was largely flat. Nifty IT gained the most at 2.6% followed by Nifty Fin Service and Nifty Oil & Gas which were up by 1.3% and 1.1% respectively. India has managed to perform well bolstered by its strong economic fundamentals. The 2QFY23 results season has concluded. The margins of most manufacturing sectors remained under pressure due to elevated input costs and subdued realizations which adversely impacted operating cash flows of private companies. While the recent decline in input costs provided relief, much also depends on consumer demand. We expect a recovery starting 3QFY23 led by softening of commodity prices and monetary easing by central banks which is likely to boost demand.

The markets are likely to see gap up opening; SGX nifty is up 142 points compared to previous spot Nifty closing. Asian Markets are trading in red; Nikkei is down 0.3% while Heng Seng is down 1.2%.

Source : Equity Bulls

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