Budget, US Fed Policy, Quarterly Earnings To Drive Markets In The Week, Say Analysts

As part of other macroeconomic data, the purchasing managers’ index (PMI) data for the manufacturing sector is scheduled to be released on Thursday

Interim Budget, the US Federal policy decision, and quarterly earnings will drive stock markets in the week, analysts said. Further, the investors would also be looking out for the trading activity of foreign investors and global trends for more cues. 

As part of other macroeconomic data, the purchasing managers’ index (PMI) data for the manufacturing sector is scheduled to be released on Thursday, reported PTI. The Interim Budget for 2024-25 is also set to be presented by Finance Minister Nirmala Sitharaman on February 1, 2024. The Federal Open Market Committee meeting will be held on January 30 and 31. 

Elaborating on the market movements, Siddhartha Khemka, Head-Retail Research, Motilal Oswal Financial Services Ltd, noted, “Market is likely to consolidate further ahead of the US Fed interest rate decision where the Fed is expected to maintain status quo and give some hint with regards to rate cut timeline. Apart from this, BoE (Bank of England) monetary policy is also due coupled with a few key economic data releases which might keep markets volatile. Further many heavyweights would be releasing their earnings this week, thus stock-specific action would continue despite market consolidation.”

Companies like Adani Green Energy, Bajaj Finserv, Bajaj Finance, Maruti Suzuki India, Titan, and InterGlobe Aviation are set to release their quarterly in the week. Rajesh Bhosale, technical analyst, Angel One, added, “This week is crucial, aligned with the key budget event, which typically sets the market direction.”

Vinod Nair, Head of Research, Geojit Financial Services, stated that market factors such as policy rate decisions of major nations are expected to impact the markets, and ‘markets are likely to witness stock-specific actions during the ongoing earnings season’. 

Notably, the equity markets experienced a downward trajectory in the last week, with the BSE benchmark slipping by 982.56 points or 1.37 per cent, and the Nifty dropping 269.8 points or 1.24 per cent. 

As the upcoming budget is an interim one, no major announcements are expected to come along with it, a report by Axis Securities stated. It added, “We expect the budget to focus more on retaining the roadmap of growth with some flavour of populism.”

Santosh Meena, Head of Research, Swastika Investmart Ltd, stated, “Budget, earnings, and the US Fed policy will keep the market on its toes. This week is poised to be pivotal, marked by a series of significant events, with the budget taking the centre stage.”

Meena added that in addition to domestic factors, the market would also be impacted by the global landscape, including geopolitical developments and movements in the US bond yields, the dollar index, and crude oil prices.