The movement of the Indian stock market next week will depend on the quarterly results of the companies, the decision of the US Federal Reserve and crude oil prices. The proposed listing of Jio Platforms and activities of foreign investors will also be monitored.
Business: After the sharp fall in Sensex and Nifty last week, the trading week starting from Monday, October 26 will be important for investors. Market experts believe that this time along with the financial results of domestic companies, news coming from America can also affect the market. Especially amid the interest rate meeting of the Federal Reserve and tensions in West Asia, investors will keep an eye on the changes in crude oil prices.
How much did Sensex and Nifty fall last week?
The week of 19 to 23 October was disappointing for the Indian stock market. There was only four days of trading due to holidays, but during this period major indices recorded a big fall. BSE Sensex fell 1,605.44 points or 2.15 percent to close at 73,123.83. At the same time, NSE Nifty slipped 546.15 points or 2.36 percent to the level of 22,600.
The market was under pressure from rising crude oil prices, selling by foreign investors and tensions in West Asia. In such a situation, the biggest question before investors next week will be whether the decline in the market will stop or the selling trend will continue further.
The movement of shares will be decided by the quarterly results of companies.
Next week many big companies are going to present financial results for the July to September quarter. These include names like TVS Motor, Asian Paints, Trent, Sun Pharma, Bharat Electronics, Indian Oil, Bank of Baroda and GAIL India.
Investors will also pay attention to the profits and earnings of these companies along with their business costs and future plans. Buying may be seen in the shares of companies whose results will be better than market expectations. In case of weak results, the respective shares may remain under pressure.
According to Ajit Mishra, senior vice president (research), Religare Broking, domestic economic data will also be important. Investors will assess September industrial and manufacturing production data to be released on October 28. This will give an indication of the status of industrial activities in the country.
Investors around the world have their eyes fixed on the decision of the US Fed.
The US Federal Reserve meeting is scheduled for October 27 and 28. The decision regarding interest rates will also be important for the Indian stock market. Investors will pay attention not only to changes in rates, but also to the Fed’s policy statements.
According to Hariselvan Radhakrishnan, Founder and CEO of HST Wealth, the market currently considers the possibility of change in interest rates to be low. Therefore, signals regarding further monetary policy will be more important.
If the Federal Reserve maintains a tough stance on inflation, the US dollar and bond yields could strengthen. Due to this, there will be a possibility of foreign investment being affected in emerging markets like India. On the other hand, stock markets may get some relief if soft policy signals are received.
Crude oil prices may increase rapidly, causing trouble
Amidst the ongoing tensions in West Asia, crude oil prices remain a major concern for the Indian market. Last week, the price of Brent crude had crossed $117 per barrel. Oil becoming expensive may impact India’s import expenses and the costs of many industries.
Ponmudi R, CEO of Enrich Money, says that inflationary pressure may increase if oil prices continue to rise. This is likely to affect the position of the rupee and the profits of companies.
India imports most of its crude oil needs. Therefore, if oil becomes expensive in the international market, the costs of airlines, paint, chemical and transport related companies may increase. Investors will keep an eye on the changes in oil prices along with developments in West Asia.
Listing of Jio platforms will also be in discussion
Apart from these three big reasons, the proposed stock market listing of Jio Platforms will also attract the attention of investors. The listing of the company’s shares is expected to take place on October 28. Investors’ reaction to this big IPO may also impact the sentiment in the primary market.
Apart from this, buying and selling of foreign institutional investors will also be important. The market may remain under pressure due to continued selling, while increased investment is likely to support the major indices.
At present, the trading week of 26 to 30 October will be important for investors. Quarterly results, US Fed’s decision and the movement of crude oil will indicate the direction of the market. Keep an eye on the official announcements of BSE, NSE and related companies for new information related to the stock market and financial results of the companies.