Market outlook: Are bull’s gearing for befitting reply to bears or more pain left after US Fed minutes? | Stock Market News

Indian stock market: Indian indices – Nifty50 and Sensex – ended Thursday’s session in red once again, dragged by selling pressure in financial and IT stocks.

The Indian stock market continued with its downward trajectory for third session straight, however, losses were limited on February 20.

The Nifty 50 closed the session with a slight decline of 0.08 per cent, settling at 22,913, while the Sensex dropped 0.26 per cent from Wednesday’s closing, ending at 75,736.

Meanwhile, the broader market remained strong in recent sessions following a prolonged downturn in stocks. The Nifty Midcap 100 index ended the session up 1.30 per cent, closing at 51,163 points, while the Nifty Smallcap 100 index saw an even higher rise of 1.43%, finishing at 15,747 points.

Fed minutes impact on Indian market

The minutes from the Federal Reserve’s January meeting, released on Wednesday, revealed that policymakers agreed on the need for further declines in inflation before considering interest rate cuts. This signaled that rates would remain unchanged for a longer period, leading to a decline in IT stocks in today’s session.

According to experts, the recent release of the FOMC meeting minutes has certainly stirred the pot. The minutes underscored a cautious stance, with the Fed emphasising the need to see further progress on inflation before proceeding with the rate cut.

“The strong recovery in broader markets over the last 2 days is encouraging as NIFTY50 21 month average is 22,500 which is to be protected 1%+- and this week was crucial from time perspective as it completes a fall of 21 weeks from all time high in Sep 24 with lot of froth been out in midcaps and smallcaps,” said Vikas Jain, head of research at Reliance Securities.

Bulls vs bear market

Sagar Shetty, Research Analyst, StoxBox, says that the market is likely to remain cautious as for bulls, it might be challenging to make a comeback.

“Given this backdrop, the market remains cautious. Bulls might find it challenging to mount a strong comeback immediately as the higher interest rates and global uncertainties continue to weigh on investor sentiment. In the short term, we expect the market to sustain pressure led by the uncertain economic landscape, but the market’s resilience and adaptability could lead to a turnaround fuelled by any positive developments, such as favourable economic data or geopolitical stability, providing the bulls with an opportunity to regain momentum,” Shetty said.

However, Vikas Jain of Reliance Securities believe that a U shaped recovery in the Indian market is in the process for the next 6- 8 weeks. “Next week is the expiry week with a mid week holdiay so rollover movement will be very swift and fast across sectors and stocks and a breakout above 23,050 levels will extend the up move in the next week. A U shaped recovery is in the process for the next 6- 8 weeks post that the focus will be on the full year results in mid April and Trump tariff dates on 1st April also will be key to watch,” Jain said.