Domestic markets in the next week may be influenced by global cues and foreign funds movement in the absence of any domestic cues and events, analysts said in their expectations. Besides, markets shall also be eyeing the US Fed Federal Open Market Committee (FOMC) scheduled next week between September 20-21, 2022, they also mentioned.

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In absence of any major domestic data and events, participants will be closely eyeing the US Fed meet, scheduled on 20-21 September, besides, the trend of the foreign flow would also remain on their radar, Ajit Mishra, VP - Research, Religare Broking said in his next week expectations.

Similarly, Apurva Sheth, Head of Market Perspectives, Samco Securities also said that the FOMC meeting, and press conference will be the center of attention next week and globally, Fed’s interest rate decision can trigger jitters in the markets.

“Given the US Fed’s hawkish stance, some people are expecting even a 100-bps rate hike. US markets already faced deep cuts when they reacted to the figures of headline CPI and core inflation for August 2022,” Sheth said in Fed rate hike expectations.

She added although India has done significantly better than all the other major markets, it is expected to remain volatile. Nifty50 on Friday closed the week at 17,530.85 down 1.7 per cent.

According to Mishra, “Markets have shown tremendous strength so far amid the global turmoil however the lingering fear of aggressive rate hikes by the US Fed has capped the upside and also trigger intermediate declines. The prevailing market structure combined with cues from the US markets is pointing towards further fall.”

On technical terms, a breakdown below 17,500 in Nifty could push the index to the 17,150 zone, the analyst as Religare Broking said, adding that in case of any rebound, the 17,800-18,100 zone would act as a hurdle.

“We feel participants should stay light and maintain positions on both sides and reiterate preference for private banking counters, suggesting using correction to accumulate in a staggered manner. Conversely, IT and pharma look weak to us and can be considered for short trades.” Mishra added. 

Hemant Kanawala, Senior Executive Vice President & Head –Equity, Kotak Mahindra Life said, “As upside from valuation re-rating is limited hereon, the future performance and direction on the market will be driven by earnings upgrade and roll over. As investors await clarity on earnings upgrade and keenly monitor demand outlook, markets may continue to consolidate in near term.”