RBI policy, global trends will be key drivers for markets this week: Analyst
New Delhi:
This week, RBI’s policy decision will be the key event driving the trading sentiment in the equity market. Also, analysts said global cues, foreign fund inflows and crude oil prices would be other key factors to keep an eye on.
The market has been seeing a boom recently. However, he said the move lacks decisiveness amid challenges such as global policy tightening due to rising inflation and geopolitical tensions.
“RBI policy, global macro numbers and crude oil prices will set the trend for this week. RBI policy result will be announced on June 8, and it will be important to hear RBI’s comment as rate hike is imminent. IIP market closes.” Later the data will be released on May 10.
“On the global front, US jobless claims on Thursday and CPI numbers on Friday will be crucial for the direction of global markets,” said Santosh Meena, Head of Research, Swastika Investments Ltd.
Crude oil continues its upward movement and if it does not cool down, it could hurt the sentiments of the markets. FIIs are still selling, though the pace has slowed down a bit. However, he added that there is a risk of further selling if the rupee weakens due to rise in crude oil prices.
Last week, the BSE Sensex had gained 884.57 points or 1.61 per cent.
“With earnings season behind us, the focus will be on the upcoming MPC’s monetary policy review meeting, which is scheduled during June 6-8. Markets are already citing sticky inflation as another hike in prices.
However, the focus will be on the commentary amid updates on favorable monsoon.
Besides, the performance of global markets and volatility in crude oil will also be looked into, said Ajit Mishra, VP – Research, Religare Broking Ltd. On the macroeconomic front, participants will be eyeing the IIP data on June 10.
Yesha Shah, Head of Equity Research, Samco Securities, said inflation is a key factor which will be central to all discussions this week as China and US inflation data will be released on the sidelines of RBI’s policy meeting.
“Markets are likely to remain in a broad range as we continue to monitor global cues, including geopolitical developments, volatility in crude oil prices and institutional flows.
“The RBI’s monetary policy meeting this week will be an important event that investors will track,” said Siddharth Khemka, Head of Retail Research, Motilal Oswal Financial Services Ltd.