The anticipation of good quarterly numbers and cautious policy actions by the Reserve Bank of India in its bi-monthly policy announcement helped boost investor confidence.
Next week, domestic investors will turn their focus to second-quarter corporate earnings. The IT sector will be the main focus as they are scheduled to announce their earnings in the coming days. Vinod Nair, Head of Research at
Globally, investors have US jobs data on their radar to determine the trajectory of global markets next week.
Key factors that may guide the markets this week:
Second Quarter Earnings: This week will see the debut of the first group of companies with their quarterly numbers, Delta Corps, HFCL, Infosys, Mindtree, Wipro, Cyient, HCL Tech, Indiapolis Real Estate, HDFC Bank and Avenue Supermarts are among the major companies due to publish their numbers. These counters may see volatile movements during the week.
Macro data: India will announce a number of macro data It will show how well the economy has recovered. Industrial Production for August, CPI for September and WPI for September are some of those. Morgan Stanley expects the IIP to be stable at 11.5 percent, the CPI at 4.3 percent and the WPI at 11.2 percent.
vaccination: The rapid pace of vaccination raised the hopes of the companies. India has administered more than 93 crores of vaccine doses, giving at least one dose to nearly half of the population. This has given wings to traders who believe that India may avoid a third wave of the coronavirus pandemic.
Subscription: Ahead of its scheduled listing next week, Aditya Birla Sun Life AMC has a small stake in the gray market. This indicates that the issue could see flat or negative listing gains on Monday.
Bond yields: India’s 10-year bond yield rose to an 18-month high of 6.32 percent. This reflects that traders are not buying into the low inflation expectations given by the central bank. On Friday, the Reserve Bank of India maintained the status quo and said it would maintain ample liquidity in the market. But if returns go up even more, that might not be a good sign for the stock markets.
After the high volatility seen last week, Nifty50 closed positive for the past week. The index was able to rebound from the support level around 17.450 after forming a doji candle. Although Nifty50 is still overbought, it has not seen any major correction. Globally too, major indicators are starting to find support after a moderate correction in price and time.” Analysts at Samco Research said.