Rising tensions in the Middle East and outflows of foreign funds were the main culprits behind the sharp fall in stock markets last week | (Photo: Shutterstock)
The Reserve Bank of India’s (RBI) interest rate decision, conflict in the Middle East and trading activity of foreign investors are the key factors that will dictate investor sentiment in the market this week, analysts said.
Moreover, quarterly figures from IT indicators for TCS, domestic macroeconomic data and movements in the global oil benchmark Brent crude would also drive the trends in the market.
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Rising tensions in the Middle East and outflows of foreign funds were the main culprits behind last week’s sharp decline in stock markets.
“On the domestic front, the market’s focus will be on the RBI Monetary Policy Committee (MPC), which will meet from October 7 to 9, 2024, the outcome of which will be announced on Wednesday,” said Pravesh Gour, Senior Technical Analyst. , said Swastika Investmart Ltd.
The second quarter earnings season begins with TCS, he said.
“Domestically, liquidity remains strong, with signs of sectoral rotation from overvalued segments to areas with more attractive valuations. In addition, commodity prices, the US dollar index and key US macroeconomic data will play a crucial role in determining the direction of the market. Geopolitical developments will also continue to be an important factor on a global level,” Gour added.
Last week, the BSE Sensex gained 3,883.4 points, or 4.53 percent, and the Nifty fell 1,164.35 points, or 4.44 percent.
“Both Nifty50 and Sensex’s new milestones of 26,000 and 85,000 respectively were short-lived as headwinds from the Middle East and flow of FII funds to cheaper Asian peers affected investor sentiment. In the past week, these benchmark indices corrected by more than 4 percent,” said Vinod Nair, head of research at Geojit Financial Services.
Market investors became poorer by Rs 16.26 lakh crore in five days of heavy stock correction.
“The market outlook will be driven by key domestic and global economic data such as India’s interest rate decision, industrial production, US FOMC (Federal Open Market Committee) minutes, early unemployment claims and UK GDP data” , says Palka Arora Chopra. , said director Master Capital Services Ltd.
Investors will keep a close eye on developments in the geopolitical situation and its impact on crude prices, said Ajit Mishra, SVP, Research, Religare Broking Ltd.
“The trend in foreign flows, together with domestic flows, will also be crucial. On the domestic front, the focus will be on the outcome of the upcoming MPC meeting on October 9,” Mishra added.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)
First publication: Oct 6, 2024 | 11:20 am IST