Indian equity indices might continue to remain volatile, following expiry of future & option (F&O) contract for the June series in the coming week, due to which we might witness huge profit-booking in the markets. With international event like, US Federal Reserve?s two-day monetary policy meeting on June 23 and June 24 is the one of the major event to watch out for in the coming week for the international markets.
However, on Friday, last trading day of previous week, US markets had closed with minimal gains, it is expected that, Indian markets might open in green on Monday. Despite, Indian markets closing above the dotted line on Friday, the 30-share Sensex of Bombay Stock Exchange (BSE) was down by over 4% and S&P CNX Nifty of National Stock Exchange (NSE) lost over 5% in the last one week.
On Friday, BSE added 256.36 points or 1.80% to close the day at 14,521.89 points, while Nifty gained 62.20 points or 1.46% to end the day at 4,313.60 points. Dealers in the markets say, ?Volatility is likely to rise in the domestic bourses ahead of expiry of (F&O) this Thursday. Last week, we witnessed some good amount of profit-booking by the domestic institutional investors (DII), which is likely to continue this week also. Apart from that, there is lot of hopes for economic reforms by the Congress-led government in the coming budget session.?
Some of the markets player also stated that, markets are also waiting for the monsoon to arrive as, it is a major influence on output of key crops, economic activity and also affects sentiment in the country?s financial markets.
In the last one week, markets witnessed huge selling from the foreign institutional investors (FII). As per the provisional figures furnished by the BSE, FII have purchased stock worth Rs 2,193.35 crore in the month of June, while DII have been sellers to the tune of Rs 620.47 crore in the current month.
?There are several FII waiting to enter the markets, as they are waiting for the budget session to get over. Once the budget gets over, we might again witness huge inflows in the domestic markets. But in the coming few days, markets are likely to remain unstable.?