1 week ago
Sensex, Nifty Open Higher Amid Oil and Liquidity Concerns
India’s main stock indexes started the day higher.
However, an expert warned that markets could become bumpy.
Oil prices have gone up sharply since early July.
New IPOs may also draw money away from existing stocks.
This could make it harder for some shares to rise.
The expert thinks small and mid-sized companies may perform better selectively.
He also said company profits and some economic conditions look supportive.
He expects markets to eventually deliver good returns but cautioned investors against buying extremely expensive stocks.
Sensex and Nifty opened higher on August 24, according to the article.
G. Chokkalingam said rising oil prices and IPO activity could pressure liquidity.
Global oil prices have risen more than 16% since early July.
Domestic institutional investors bought equities worth Rs.8.09 lakh crore in FY26, while foreign institutional investor selling was Rs.1.81 lakh crore.
The expert expects volatility and a downward bias but sees selective opportunities in small- and mid-cap stocks.
- Who
- G. Chokkalingam, Head of Research at Equinomics Research, provided the market outlook.
- What
- The Sensex and Nifty opened higher, while an expert warned of oil-price, liquidity and IPO-related risks.
- Where
- The domestic Indian stock market.
- When
- August 24; the comments address the trading session and the week ahead.
- Why
- Higher oil prices and funds moving into IPOs could reduce liquidity for stocks traded in the secondary market.
Market Caution
Long-Term Optimism
Near-term direction
Market Caution
Rising oil prices and IPO fundraising may drain liquidity from secondary markets, creating volatility and a downward bias.
Long-Term Optimism
Domestic macroeconomic conditions, external factors and double-digit earnings growth remain supportive of markets.
Stock selection
Market Caution
Stocks with elevated valuations could eventually fall if new themes and IPOs struggle to attract fresh liquidity.
Long-Term Optimism
Small- and mid-cap stocks may offer selective opportunities as mutual funds and new retail investors continue entering the market.
Long-term returns
Market Caution
Sensex and Nifty are entering a third consecutive year of negative returns, according to the article.
Long-Term Optimism
The expert said markets have historically recovered after prolonged bearish periods and expressed confidence that they will eventually provide good returns.
Key facts
- Market opening
- Sensex and Nifty opened higher on August 24.
- Oil prices
- Global oil prices have risen more than 16% since the beginning of July.
- Earnings growth
- Corporate earnings growth reached 13% year over year in Q1FY27.
- DII purchases
- Domestic institutional investors purchased equities worth Rs.8.09 lakh crore in FY26.
- FII selling
- Foreign institutional investor selling stood at Rs.1.81 lakh crore during FY26.
- Market outlook
- The expert expects volatility with a downward bias but favors selective small- and mid-cap opportunities.
- Valuations
- The expert said valuations have become attractive after two years of prolonged weakness in the Sensex and Nifty.
Quotes
G. Chokkalingam
Head of Research at Equinomics Research
“Hence, apply caution while chasing stocks that have valuation bubbles.”
timesnownews.com
“liquidity and oil prices may remain a cause of concern.”
timesnownews.com
Sources
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