Stock market analysis: As earnings season winds down, here are 5 key triggers for Nifty this week

NEW DELHI: Despite Friday’s profit booking, the main Nifty index managed to close on a positive note for the fifth straight week posting a weekly gain of 0.34%. With the peak of the earnings season now over, the focus now shifts to macro events, FII flows, and developments in the Dollar Index and Crude Oil. The scheduled expiration of derivatives on Thursday will also keep participants busy this week.

“Markets could see some consolidation after five weeks of successive increases and that would be healthy. We have hardly seen any major declines in the index during the recent consolidation phases, but a lot would depend on the performance of the US indices. where we still see room for further upside,” said Ajit Mishra, VP – Research,

Brokerage.

Here are 5 key factors that could influence market sentiment this week:



dollar index
The U.S. dollar index hit a five-week high and posted its biggest weekly gain since April 2020 on Friday as investors adjusted to the likelihood that the Federal Reserve would continue to raise rates to fight inflation. . Analysts say any further rise in the dollar index could disrupt capital inflows into the Indian market.

crude oil rate

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Brent crude futures settled below $97 a barrel on Friday and fell about 1.5% on the week on a stronger U.S. dollar and fears an economic slowdown could erupt. weakens demand for crude. “In light of recession concerns, Brent prices are down and were at a six-month low last week. The market will try to decipher the movements of the same in the future,” said Apurva Sheth, Head of Market Insights, Samco Securities.

IFI flow
One of the main factors driving the market rally in recent days has been the FII buying frenzy. The market will watch this trend closely as any reversal could cause a temporary anomaly, Sheth said.

Macrodata
The United States will release its first unemployment insurance claims data on August 25, while on the 26th Fed Chairman Jerome Powell will speak at the Jackson Hole Economic Symposium. “Global investors will be closely watching Powell’s remarks as well as the minutes of the European Central Bank’s July meeting. During this volatile session, investors may resort to buying into the dips of high-quality stocks,” Vinod Nair, Head of Research at

said.

Technical factors

Friday’s large bearish candle engulfed the price movement of the previous three sessions, which is a sign of weakness.

Sameet Chavan, Chief Technical and Derivatives Analyst, Angel One, said the overall trend remains strongly bullish and since we have bounced vertically from 16,400, we could see further profit bookings this week. “The view remains valid as long as 18,000 is not sustainably breached. Additionally, with a likely decline, this should be seen as a healthy development for the next leg of the rally and should therefore be used to go long .

(Disclaimer: The recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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