India VIX hovering near record lows signals muted volatility and supports a gradual market recovery, as traders price in lower uncertainty.
The broader market structure remains positive, with repeated affirmations of strong support zones on the Nifty. Further, the market strength is supported by earnings momentum and improving macro indicators.
Despite the threat of a spiralling of conflict in the middle east this month, the India Vix has still not crossed the highs seen on June 13, the day when Israel began military action on Iran's defence and nuclear infrastructure.
The range=bound trade will be broken only on news of de-escalation of the Israel-Iran conflict or an abrupt end to the war, suggested experts.
India VIX, a key indicator of market volatility, dropped below 14 on June 19, marking a 20 percent decline over the past month.
Sensex, Nifty rallied sharply on Thursday on the back of strong global cues, anticipation of a policy easing by the RBI and renewed foreign fund inflows.
Volatility index, often referred to as the market’s fear gauge, has been fluctuating sharply between 15 and 23 levels since April.
Volatility spiked in Indian markets on May 22, with India VIX crossing the 18 level as debt market related tensions weighed on sentiment.
As traders digested the news of a ceasefire between India and Pakistan, following cross-border tensions, the volatility and nervousness in the markets cooled significantly.
The appearance of a Bearish Engulfing candle on the weekly chart sends a clear message - the bulls are stepping back, and the market is showing signs of fatigue.
Stock market crash: Investor wealth to the tune of Rs 5 lakh crore got eroded as the India-Pakistan tensions rattled investor sentiment
Volatility spiked in Indian markets on May 9, with India VIX crossing the XX mark as geopolitical tensions weighed on sentiment.
Volatility spiked in Indian markets on May 8, with India VIX crossing the 20 mark as geopolitical tensions weighed on sentiment.
India VIX dropped sharply on Tuesday, indicating growing confidence and relative stability in the near-term market outlook.
Unless the VIX cools off to levels around 18, market experts believe volatile swings in the markets could be the new norm
Veteran trader and investor Sushil Kedia said market behaviour seems irrational looking, at options pricing, but that does not mean stocks have bottomed out.
India Vix witnessed one of the steepest rises on Monday as investors brace for high volatility amid global trade war fears.
Experts expect the sentiment to remain bearish in the short term amid likely high volatility with more focus on further tariff developments. Apart from that, the market will also take cues from several factors lined up next week including the RBI policy, corporate earnings, FOMC minutes, and inflation numbers.
As India VIX - the volatility gauge - rises, the Nifty 50 index often declines, and vice versa, with higher VIX signalling greater uncertainty, thus leading to a fall in the value of the benchmark.
Smaller and mid-cap shares have tumbled more than the broader market since the Sept. 26 high, with Nifty gauges tracking them down more than 18%. While investors have so far remained largely bearish, some firms have turned positive recently.
The fear index hit a high of 17.4 - a level last seen on August 6, 2024 - after surging for four successive sessions and has risen by nearly 20 percent so far this year.
In October, FIIs have been on a selling spree and have sold shares worth Rs 85,000 crore. However, DIIs have been acting as a strong counterforce by buying shares worth Rs 1.07 lakh crore.
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Strength in banking stocks, rupee, and easing bond yields were some of the major factors behind Nifty's record high move, say analysts