Mkts facing global headwinds in near term

New Delhi There are strong headwinds, both globally and domestically, that can impact the market in the near-term, said V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Global headwinds are from the rising dollar index at 103.23 and spiking U.S. bond yields, he said. Consequently, FIIs are selling, taking their cash market sell figure in August, till 15th, to Rs9,867 crore. Domestically, the major headwind is the rising inflation, he said.

July CPI inflation has come at 7.44 per cent, which is 1 per cent above consensus estimates. The CPI inflation for FY’24 will have to be revised upwards to 5.6 per cent. The takeaway from this is that a rate cut can be expected only in H2 of CY24, he added. This is negative for rate sensitives. So, the banking sector, which has been a pressure point for the Nifty is likely to experience more near-term pain.