Macro Trends, RBI Monetary Policy, Q3 Results To Drive Stock Markets: Analysts

Further, foreign investors’ trading activity along with the fluctuations in the global oil benchmark, Brent crude, will also influence the equities, experts noted

Quarterly earnings by major companies, global macro trends, and the Reserve Bank of India (RBI)’s upcoming monetary policy meeting will drive the stock markets in the week, analysts noted. The banking regulator’s interest rate decision in the meeting will be impacted by the Budget 2024 announcements and the US Fed’s monetary policy outcome. 

Further, foreign investors’ trading activity along with the fluctuations in the global oil benchmark, Brent crude, will also influence the equities, experts noted, reported PTI. Notably, the RBI’s Monetary Policy Committee (MPC) meeting is scheduled to begin on February 6, 2024, and conclude on February 8, 2024.

Third quarter financial results from major corporations will also be keenly observed by the investors. Pravesh Gour, Senior Technical Analyst, Swastika Investmart Ltd, stated, “Bharti Airtel, Power Grid, Nestle, Lupin and Tata Power will announce their results this week. Market participants will be keeping an eye on the movement of the rupee against the dollar and crude oil prices. Investments by Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) will also be monitored.”

Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, added, “With the US Fed and interim Budget now behind, all eyes will be on RBI's policy meeting this week.”

Notably, the two key equity benchmarks, Sensex and Nifty, made a strong rally in the last week. The BSE Sensex gained 1.95 per cent or 1,384.96 points, while the NSE Nifty50 soared 2.34 per cent or 501.2 points. In the last trading session on Friday, the Nifty50 index also hit a new peak of 22,126.80. 

Commenting on the outlook for the week, Arvinder Singh Nanda, Senior VP, Master Capital Services Ltd, said, “The market focus will be on the ongoing Q3 FY24 earnings season, with many companies announcing their results in the coming days such as Ashok Leyland, Bharti Airtel, Apollo Tyres, Nestle, Grasim, LIC.”

Nanda noted that the market will respond to crucial domestic and international economic data, crude oil inventories, rupee’s movement against the dollar, and the investment pattern of DIIs/FIIs. “Economic numbers will impact the market such as S&P global services PMI of countries like India, UK, US, initial jobless claims, China's inflation numbers and India's interest rate decision,” he added. 

Ajit Mishra, SVP - Technical Research, Religare Broking Ltd, noted, “The tone was positive for the most part of the last week amid favourable global cues and buying in select heavyweights. We expect volatility to remain high this week as well and the focus will be on earnings and RBI meet for cues. On the global front, the steady uptrend in the US markets will continue to favour the bulls.”