Markets to be in 'wait and watch' mode ahead of Budget: Analysts

The Union Budget 2019-20, to be presented later this week, will be the decisive factor for equity markets going ahead and investors are likely to be in a 'wait and watch' mode ahead of the mega event, analysts said.

However, markets may see some upmove following the trade truce announced by the US and China at the G-20 summit over the weekend, they added.

Besides, progress of monsoon, rupee and crude oil movement will also be tracked by participants.

"The election outcome is more of an emotional event while the Budget has more rational reactions in the market. The lackluster vibe before the Budget can be the calm before the storm and markets are expected to remain muted and sideways but there is likelihood of downward pressure," said Jimeet Modi, Founder and CEO, SAMCO Securities and StockNote
Mustafa Nadeem, CEO, Epic Research, said, "We have a very important event, Budget, that is about to shape the future trend of equity markets. There will be possibly an increase in volatility and may further hurt any directional trader for the very short term. Since the importance of the event is high and is able to produce large trend, we believe it is better to be on the sideline and see the outcome."
According to Vinod Nair, Head - Research, Geojit Financial Services Ltd, "auto and metal sectors are likely to be subdued due to low demand and benign raw material prices. Government seems to have hectic task ahead- to support growth and maintain fiscal prudence which will be closely watched by the market."