RBI MPC meeting at US jobs data: 5 factors that could impact the stock market this week

Scholarship this week: Following strong global signals and the return of foreign investors (REITs and FIIs), Indian stocks ended higher for the third consecutive session on Friday. Over the past week, the Nifty 50 index gained 2.62% last week as it recorded a monthly gain of 8.70% in July 2022. Similarly, the BSE Sensex jumped 2 .67% last week as it recorded a monthly gain of 8.50% in July 2022. .

“July proved to be a relief for market participants as after a sharp correction over the previous three months, Nifty rallied this month and posted gains of over 8%. The rise was led by the banking and finance space but late all sectors participated resulting in a broad rally in the market Now the Nifty has recovered the 17000 level so let’s see some data to predict if the move bullish will continue in the near term or vice versa Firstly if we look at the derivatives data, the rollovers were slightly below average and the upward move in July was mainly due to a combination of short covering and formation FIIs that were aggressive sellers over the past three months covered their short positions and in fact started the August series with net long futures positions on clues,” said Ruchit Jain, head of research at 5paisa.com.

“The Nifty Bank Index led the benchmarks rising more than 12% during the month. The index is now hovering near the 37,500 mark, which is the potential reversal zone for a harmonic pattern bearish called CYPHER On the upside 38000 is also a reversal zone for SHARK pattern so we expect profit bookings of the 37500-38500 area in the coming month. 36,800 to 36,200 could prove to be strong support for the week ahead,” said Mehul Kothari, AVP – Technical Research at Anand Rathi.

After July’s good show in Dalal Street, stock market watchers expect its repeat in August as well. However, investors are advised to remain vigilant as to the main triggers likely to dominate stock market movement.

Here we list the main triggers that could impact the stock market this week:

1]RBI MPC meeting: “Markets expect the RBI to raise repo rates by a further 50 basis points next week to 5.4% from the current 4.9%. inflation and promoting economic growth. The RBI Governor’s comments will have a stirring effect on the markets next week,” said Sreeram Ramdas, Vice Chairman of Green Portfolio.

2]US employment data: Data on US nonfarm payrolls and employment would provide clues to the health of the US labor market and guide Fed monetary policy.

“The US jobs data is an important trigger as US markets closely follow US GDP and US employment data. As estimated US GDP numbers this week have been disappointing. If U.S. jobs data is also disappointing, it would put the dollar index under immense pressure, leading to a strong rally in the domestic currency and market sentiment. U.S. employment data coming next week,” said Anuj Gupta, vice president of research at IIFL Securities.

3]Bank of England interest rate: “The Bank of England is expected to raise interest rates a further 25 basis points to 1.5% next week. Retail sales, mortgage approval rates, consumer deposits and business confidence consumers have taken their toll on skyrocketing inflation in the UK as consumer borrowing peaks for the wrong reasons.Further interest rate hike signals or any surprise comments could further hamper the UK economy said Sreeram Ramdas of Green Portfolio.

4]Q1 results: Nearly one-fifth of NIFTY 50 companies across various industries report earnings next week. These impressions will provide insight into the strength of consumer demand and the rise in automotive demand. Earnings for several small- and mid-cap companies that are heavily dependent on the United States are expected to see slower growth numbers due to the technical recession the United States has entered.

5]DII FII Data: Although FIIs remained net sellers in the month of July, they are signaling buying interest. If the dollar index and bond yields continue to fall, FIIs are likely to stop selling and in that case Indian equities could see a big rally as DIIs are already pumping money into the markets,” he said. said Anuj Gupta of IIFL Securities.

Disclaimer: The opinions and recommendations made above are those of individual analysts or brokerage firms, and not of Mint.

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