Benchmark stock market indices opened flat on Tuesday as markets consolidated ahead of a busy day with many Q2 results to be announced.
The S&P BSE Sensex was down by 123.01 points to 83,855.48, while the NSE Nifty50 lost 53.50 points to 25,710.05 as of 9:33 am.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said that FIIs’ renewed selling is constraining the rally in the market.
“During the last four days FIIs have sold equity worth Rs 14269 crores. This is an indication that they will continue to sell on rallies. Higher valuations in India and muted earnings growth are restraining FIIs who are more focused on cheaper markets with better earnings growth. However, this is likely to be a short-term challenge,” he added.
Medium-term prospects look good with robust GDP growth and impressive sales data, particularly from automobiles. Modest earnings growth of banking and poor earnings growth of IT will restrain earnings growth in FY26. But impressive earnings growth around 15% is likely in FY27 and the market will soon start discounting this.
A significant trend in the market is the resilience of the PSU banking space. This segment is even now attractively valued in a market which is richly valued. The prospects of this segment look bright in the context of the coming merger of PSU banks.