Domestic markets are expected to open flat on Tuesday, though analysts expect intra-day volatility to continue. Nifty at 24,380 indicates a flat opening. Analysts said the focus shifts to the financial performance of India Inc., which will start trickling from this week.
Analysts said that markets could witness a range-bound session due to a lack of fresh triggers.
Q1 preview
Motilal Oswal Financial Services estimates the MOFSL Universe earnings to remain flat and Nifty earnings to grow 4 per cent YoY in 1QFY25. However, excluding OMCs, the MOFSL Universe and Nifty earnings are expected to grow by 11% YoY and 8% YoY, respectively. Margin tailwinds are likely to ebb due to a high base.
The overall earnings growth is anticipated to be driven, once again, by domestic cyclicals such as Auto (+18% YoY) and BFSI (+15% YoY), with improved contributions from Healthcare (+21% YoY) and Metals (+12 % YoY). Conversely, earnings growth is likely to be weighed down by global cyclicals, such as O&G (led by OMCs), which are anticipated to decline 36% YoY, along with Cement (-15% YoY) and Spec. Chemicals (-20% YoY). The Real Estate (+37% YoY) and Retail (+14% YoY) sectors would report strong growth, while Consumers (+10% YoY), and Technology (+6% YoY) are anticipated to post moderate growth YoY. Our FY25E and FY26E Nifty EPS remain stable at INR1,134 and INR1,330, respectively. We estimate the Nifty EPS to grow 13%/17% in FY25/FY26.
According to analysts, technically the markets remain at the same level.
Rajesh Bhosale, Equity Technical Analyst, Angel One, said Technically, not much has changed. “We reiterate that a correction is likely in the near term, either price-wise or time-wise.”It appeared that traders were focusing on opportunities outside the index, as there was notable stock-specific rotation. On Monday, the FMCG and Oil & Gas sectors were in focus, bucking the trend. “Such opportunities may continue to arise, and traders should keep an eye on identifying these themes,” he added.
Ajit Mishra – SVP, Research, Religare Broking Ltd, said:We anticipate a time-wise correction in the Nifty index due to rotational buying in heavyweight stocks, which has limited the downside so far. However, there are ongoing buying opportunities in select sectors and themes. Traders should exercise caution in stock selection and prioritise effective trade management strategies.
Meanwhile, equities across the Asia-Pacific region are largely up.