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The NSE Nifty 50 today index fell 0.44% to 15,293, while the S&P BSE Sensex fell 0.26% to 51,360.42, both indices falling to more than one-year lows in their sixth straight session of losses. The blue-chip indexes logged losses of around 5.5% each for a week that saw the U.S. Federal Reserve hike interest rates by 75 basis points.

Is market on the verge of making a bottom? Many investors who want to put fresh money into equities are grappling with this question.

"It is impossible to predict the market bottom. Ideal Investment strategy now should be calibrated buying in high quality growth stocks. Mutual fund SIP investors can consider increasing the amount of investment," V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

“The dominant theme impacting equity markets globally is the synchronised global monetary tightening and the consequent fears of economic slowdown. The probability of the US slipping into recession is much higher now. Markets are discounting these concerns. The PE of S&P 500 is now around 16, close to the long-term average. Europe is trading at around 11 times. Markets will bottom out earlier than the economy does," said Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

“In India, valuations have declined, but are even now above long-term average. So, FPIs will continue to sell, capping a relief rally which can come any time," he added. 

Analysts have said selling by foreign investors and fears of damage to economic recovery from aggressive monetary policy tightening were causing jitters in the market. Foreign investors have withdrawn a net $3.64 billion from Indian equities this month after selling a net $5.18 billion in May.

"Rising inflation and policy tightening by global central banks are forcing the market to discount the possibilities of recession. With central banks’ policy tone pointing towards continued rate hikes of higher magnitude, we can expect FIIs to maintain their selling spree. The domestic market will continue to trade with high volatility in the near term, however, the ongoing corrections are opportunities in disguise on a medium to long-term investments," said Vinod Nair, Head of Research at Geojit Financial Services.

Nifty technical outlook

Deepak Jasani, Head of Retail Research, HDFC Securities.

Nifty fell and formed a doji after the recent downmove on June 17, suggesting possibility of an upward reversal. This is after a 5.6% fall over the week, the highest since May 2020. The low of June 17 (15183) will hence be crucial while on rises 15335 and 15659 can act as resistance."

Nagaraj Shetti, Technical Research Analyst, HDFC Securities

“The market has been in a sharp down trend over the last 14-15 sessions. Minor consolidations or small upside bounces have resulted in a sharp weakness as of now. Hence, any upside bounce from here could be a sell on rise opportunity for the short term. On the higher side, the area of 15600 levels (mid part of Thursday's long bear candle) is expected to be a crucial overhead resistance ahead and is unlikely to be broken on the upside in a hurry. After a small upside bounce, the Nifty could slide down to the 15000-14800 levels in the near term."

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