Fortnightly Market Outlook- May 2024

The market is currently hovering near its all-time high, driven by strong past momentum and sector rotation dynamics. Notably, FMCG and IT sectors are trailing behind, while metals and autos are leading the charge. Over the past month, all sectors, except IT, have shown positive performance, with pharma maintaining a relatively stable trend.

While there are worries about a potential loss of momentum, the overall market sentiment remains bullish. Nifty is anticipated to explore levels between 23000-23200 before June 4th, coinciding with a significant general election outcome. On the downside,  key support levels are identified at 22300-22200, with a lower support at 21900.

The Federal Reserve has signaled a commitment to keeping interest rates higher for an extended period, driven by concerns about inflation. Although geopolitical tensions persist, crude oil prices are expected to stabilize. The Fed’s decision to maintain unchanged interest rates aligns with the market’s expectation of either a single rate cut or no cut for the calendar year.

Gold remains an attractive investment opportunity, expected to perform well in the foreseeable future. The Hang Seng Index has shown signs of resurgence after a prolonged downturn since February 2018, with the potential for further upside.

Public Sector Undertakings (PSUs) in Indian markets emerge as a notable area of strength within the market.

Despite lingering concerns such as inflation and geopolitical uncertainties, the prevailing market sentiment leans towards bullishness, although with variations in sectoral performance.

I shall review it back for you in a fortnight.

In case you have any service requirement/ investment query or wish to infuse more funds into your portfolio, please reach out to me and shall be glad to assist !