Amidst the current volatility in the stock market, investors are eagerly looking for buy-able options. Many are expecting the Nifty 50 Index to offer attractive positions in the near future. This week, experts predict a consolidation phase in the Nifty 50, followed by a likely outperformance relative to the other major indices.
At present, the Nifty 50 has been relatively muted, gaining just 0.62% for the month so far. This is in contrast to BSE Sensex which gained 2.31 percent, and the S&P BSE Midcap index, which gained 9.11 percent. Nonetheless, experts believe that this week investors can watch out for an imminent consolidation in the Nifty 50.
The consolidation will come in the form of a pause in the current bearish trend to make way for a general acceptance of the new highs in the index. The market fundamentals remain steady, and the company earnings are expected to remain solid, indicating that the index may soon begin to outperform the other indices. This is in line with broad expectations that the Indian economy is likely to outpace global growth in the coming quarters.
Additionally, the week ahead sees the slated start of Union Budget 2021, which could add fuel to the fire in terms of market activity and support the markets. The budget, which will be presented in Parliament on February 1, is expected to focus on basics such as healthcare, education, rural infrastructure, and agricultural payouts. All of these could potentially create investment opportunities over the next few weeks, especially in the Nifty.
It is important to remember that a secular move in the market requires caution. Therefore, investors should exercise due diligence and remain aware of the changing market dynamics. With the stage set for a consolidation in the Nifty, investors have the chance to make good returns in the near future. The week ahead will be crucial in assessing how the index performs relative to the other indices.