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The outcome of state election, foreign flows, commodity prices and trade deficit balance will dictate market momentum in the medium to long term, analysts have said
Inflows to fixed income, including corporate debt, have reached nearly $6 billion thus far in 2023, with this month alone accounting for about a quarter of the flows, according to data compiled by Bloomberg.
"The last few months are more for campaigning/sloganeering rather than actual spending. To that extent, I feel that we may see a tempering of actual capex spend from the government over the next couple of quarters. A real pick-up would be once the new cabinet is in place. For now, we would like to take advantage of any volatility in the prices of capital goods companies to add some from the ‘flow category of companies to our portfolio."
Two other major IPOs to look out for are Mini Ratna company Indian Renewable Energy Development Agency, and Fedbank Financial Services. As for the Nifty50, analysts expect the index to remain in a consolidation phase until it decisively breaches the 19,850 mark. On Friday, the index ended 0.2% down at 19,731.80 points.
“I expect the demand story around the consumer goods basket to remain fairly healthy right up to the parliamentary election. That augurs well. Though the numbers have not been great, I would still say that it is a good point to accumulate consumer stocks at this point in time, given the outlook for the next six months.”