Indian equity benchmark indices ended in the red for the fourth consecutive session on Friday as the index was dragged by losses in heavyweights HDFC bank, ICICI Bank, HDFC Bank, Tata Consultancy Services (TCS), Bajaj Finance and Bajaj Finserv. Sensex fell by 575 points to intraday low of 58,551 and Nifty 50 index fell below its crucial psychological level of 17,500. The market is expected to remain slightly volatile next week as some factors are going to guide the market next week.
“The domestic market remained in a consolidation phase throughout the week as the market lacked major positive domestic cues to counter the downside pressure from the global markets. The rise in yields and crude oil prices coupled with the US debt limit crisis raised concerns in the global market. Concerns over the Chinese economy also put pressure on Asian stocks. Eurozone inflation hit its 13-year high of 3.4% in September due to higher energy costs. Vinod Nair, Head of Research at Geojit Financial Services, India’s core sector output grew 11.6 per cent in August, compared to a growth of 9.9 per cent in July, while the manufacturing PMI rose to 53.7 in August from 52.3 in August.
“Auto sales numbers from major manufacturers saw a decline in September sales mainly due to lack of semiconductor supply, however, expectations are high on the festive season. On the domestic sector front, IT and banking saw consolidation ahead of Q2 results, while PSUs, metals and pharma gained momentum,” Nair said.
COVID-19 numbers and vaccinations
With the overall COVID-19 cases declining in the country and the vaccination process going in full swing, the economy is going to rebound at a much faster pace than before and this is going to boost investor sentiment on Dalal Street. And that will be one of the major driving factors for the markets.
RBI Monetary Policy
This is also one of the most important factors that is going to affect the course of the market in the coming week. The Reserve Bank of India is scheduled to announce its bi-monthly monetary policy on Friday, October 8. The central bank is expected to maintain its liberal stance to maintain adequate liquidity in the system and support economic activity. Also, it will be necessary to listen to the commentary of RBI Governor Shaktikanta Das.
Q2 Income
India Inc will officially begin the earnings season for the September quarter as largest IT player Tata Consultancy Services (TCS) announces its second quarter results on Friday, October 8. Most of the estimates are priced by the market for the IT sector.
India’s service PMI
India ended the first half of the current fiscal with a good number of positive news on the economic front. India’s service PMI is also going to be released further, in addition to this market overall PMI, bank loan YOY growth will be released next week which is weighing on the market.
global signal
Apart from domestic factors affecting the market, global market factors will determine the course of the markets. Global markets have been quite volatile so far, with some weakness recently. The biggest concerns are inflation and signs of a slowdown in China. Besides, the US market is also showing some signs of declining growth. The eyes of the market will be on the global data to get further direction.
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