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Bank Nifty came back strongly and short covering was in place for many individual stocks. The biggest positive sign was that many large cap names like L&T, ICICI Bank actually managed to do pretty well.

The past five days of trade are important from many technical perspectives. After holding on to the level of 100-Week MA, the Nifty has avoided violation of this important support on a closing basis. The 100-Week MA is presently at 15454 making this a crucial support for the Nifty at close levels.

The governor’s outlook may spur expectations of revisions in coming policy updates. In June, the bank said inflation was expected to average 6.7% in the year to March, and while prices will start to cool from the second half, starting in October, the mandate could be met only in the January-March quarter.

It has been shown by research, conducted by Brinson, Hood, and Beebower (acronym BHB) that more than 90% of volatility in a portfolio can be addressed by asset allocation and not chasing one asset class like equity or debt. In 1986, these three researchers put forth, that asset allocation is the primary factor for a portfolio’s return variability, and security selection or market timing is secondary.

Top executives termed the first quarter of fiscal 2023 as "challenging" from the point of view of rising costs due, in large part, to rising attrition which touched 19.7% compared with 17.4% in the previous quarter. Sequentially, revenue for the April-June quarter rose 4.3% even as profit contracted 4.6%.

Opining that the Nifty has bottomed out, market expert Rishiraj Maheshwari said all negative surprises have already been factored in. “There is no fear in the market. When momentum returns, it doesn’t give you the time to buy. Nifty should be range-bound in the near term,” said Maheshwari, founder of RISCH Wealth and Family Office.

In the last three months i.e. from April to June, the Nifty50 index has fallen by 9.65%. This fall makes it the tenth time since 2002 that the benchmark has fallen for three consecutive months.

Tata Motors said that the company had made all attempts to absorb the rising costs before taking the decision to hike consumer rates.

“Some element of the earnings compression has been priced in. Probably not all of the risk there, but that’s probably not crazy,” said Matt Benkendorf, chief investment officer at Vontobel Quality Growth Boutique. “The market gets quite scrambled when it has to digest a few exogenous things at once.”

In an interview with ETMarkets, Chanda who has over 18 years of experience in the BFSI space, said: “I feel the Banking Sector will turn out to be the dark horse for this year. We have witnessed the sector taking a beating due to Covid and its after effects.”