Mumbai: Indian stock markets face a crucial week, with the Reserve Bank of India’s interest rate decision, quarterly earnings, crude oil prices and global bond yields expected to guide trading, analysts said.
Investors will also track economic data and foreign fund flows after shares recorded their eighth consecutive weekly decline.
RBI Policy Takes Centre Stage
The RBI’s policy announcement will be the domestic trigger. Its comments on inflation, economic growth and the outlook for interest rates could shape investor expectations.
Ajit Mishra, SVP, Research, Religare Broking, said the policy stance and projections would provide cues on the direction of domestic rates and financial markets.
India’s final HSBC Services PMI and Composite PMI readings for September, scheduled for October 6, will draw attention.
TCS Opens Earnings Season
Results will provide a test for sentiment. TCS is scheduled to announce its September quarter earnings on October 8, while retail major DMart is also among companies reporting this week.
The announcements mark the start of the earnings season, giving investors information on company performance amid an uncertain global backdrop.
Oil And Bond Yields Matter
Brent crude above USD 100 a barrel remains a concern for India’s inflation outlook and external balances, said Ponmudi R, CEO of Enrich Money.
He warned that geopolitical uncertainty could keep energy prices elevated.
Lower US Treasury yields could ease pressure on emerging markets and help foreign investment flows. A further rise, however, could make US assets more attractive and prolong selling elsewhere.
Markets Carry Heavy Losses
Last week, the Sensex lost 1,986.04 points, or 2.68%, while the Nifty dropped 718.55 points, or 3.10%.
During September, the Sensex declined 4,476.98 points, or 5.81%, and the Nifty fell 1,459.95 points, or 6%.
Foreign selling, rupee weakness, expensive crude and rising bond yields weighed on sentiment.
Hariselvan Radhakrishnan, Founder and CEO of HST Wealth, said US Federal Open Market Committee minutes would indicate policymakers’ support for further monetary tightening after September’s rate increase.
