FII inflows, economic data, Q4, key factors to decide the market in the coming week

In the holiday-shortened week from May 2 to May 5, the Sensex and the Nifty 50 closed with gains of around 1% each.

On Friday, the Sensex closed 694.96 points or 1.13% lower at 61,054.29, while the Nifty 50 closed 186.80 points or 1.02% lower at 18,069. HDFC and HDFC Bank registered heavy losses on Friday, falling nearly 6% each.

However, overall, HDFC Bank’s weekly fall is around 3% and HDFC’s is over 2%. The Sensex gained 443 points or 0.7% and the Nifty 50 advanced over 171 points or 0.96%.

Ajit Mishra, VP Technical Research, Religare Broking said, “Markets remained almost unchanged in a volatile week amid mixed signals. Initially, the tone was positive, which further strengthened on the weekly close, however, HDFC twins saw a sharp cut in the final session.” erased all the gains.As a result, both the benchmark indices, Nifty and Sensex ended unchanged at 18,069 and 61,054.29 respectively.

Meanwhile, in terms of sectoral indices, Mishra said they traded mixed, with auto, energy and FMCG posting decent gains, while banking, realty and pharma declined.

The broader indices managed to hold the higher end for another week and rose in a range of 0.5%-1.0%.

Further, Vinod Nair, Head of Research, Geojit Financial Services, said, “The domestic market remained positive at the start of the week, aided by strong FII inflows and favorable domestic macroeconomic data. Manufacturing PMI and GST collections in April were on the rise in new business.” It is better because of a strong uptick in consumer demand and improving supply chain conditions.”

So far, Nair said, “half of the Nifty 50 companies announced their results, and the earnings growth of those stocks was below estimates, mainly due to the weak performance of IT, metals and cement stocks. While banks, Results for financials, and autos were better than estimated.”

However, the Geojit expert also said, “Global market volatility emerged due to Fed’s concerns over high inflation despite ECB softening its language on future rate hikes and ECB’s aggressive policy action.”

What to expect in the coming week?

In his weekly outlook note, Nair said, “We expect foreign inflows to continue and favorable domestic macroeconomic conditions to protect the downside.” Nifty’s Q4FY23 earnings estimate is up 11% YoY, hence, the next set of results should be better. Chances are.” And will support investor sentiment. In the coming week, the release of US and Indian CPI inflation data will be keenly watched by the market to gain direction.”

Similarly, in the coming week, Mishra said, “Participants will be eyeing macroeconomic data i.e. IIP and CPI on May 12 for cues. Besides this, US inflation, which is due on May 10, will also be on their radar.” “

On the earnings front, Mishra said, “Dr Reddy’s, LT, Asian Paints, Eicher Motors, Cipla, HPCL and Tata Motors are some of the major names that will announce their numbers during the week.”

According to Mishra, the market is likely to spend some time around the current levels after the sharp fall in the banking index. Meanwhile, alternate buying in other key sectors such as auto, FMCG, energy and IT will continue to provide business opportunities.

With respect to Nifty 50, Mishra said, “17,850 will continue to act as an important support, while the upside is capped at 18,350.”

For investors, Mishra said, “We thus recommend to focus on stock selection and risk management overnight till Nifty resumes trend.”