Prepare for more volatility amid geopolitical crisis and election results

The race was choppy for the markets last week as Indian indices reacted strongly to geopolitical events. Commodity markets were not spared either. The prices of the main raw materials, in particular crude oil, have risen sharply.

As the Russian military steps up the assault on Ukrainian cities, Brent crude oil soared to $121 a barrel on March 3 before falling back to $110 a barrel amid talks to revive the nuclear deal with Russia. ‘Iran. Wheat prices have also climbed more than 58% and corn prices have climbed more than 20% this month.

It will also be an action-packed week where geopolitical developments will continue to impact the performance of global financial markets.

Back home, all eyes will be on the assembly election results for five key states – Uttar Pradesh, Punjab, Uttarakhand, Mizoram and Goa – due to be announced on March 10.

Given the sharp rise in Brent crude oil prices, most analysts expect the government to raise gasoline and diesel prices this week.

Let’s hear from Geojit Financial’s Gaurang Shah on how he sees the markets unfolding.

By the end of the week, India will also release Industrial Production (YoY) and Manufacturing Production (MoM) data.

Globally, the US Federal Reserve will kick off this week by releasing consumer credit data for January 2022 today. Investors will be watching closely whether consumer spending has surged or bottomed out after the third wave fueled US inflation to a 40-month high.

The European Central Bank (ECB) is expected to deliver its decision on rates and asset purchases on March 10. Additionally, the United States will release consumer price index (CPI) year-over-year data for February 2022 on March 10.

So how do you approach the markets then? Here are the key tiers you need to keep an eye on.

Technical charts suggest a negative setup for Nifty 50 with the index sliding below 16,000 levels, with 16,150 serving as support for the benchmark. The selling intensity is likely to increase as Sensex signals a decline to 53,000 with support at 53,850 to 53,550.

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