August 26th 2024.
Analysts predict that this week, the stock market will be influenced by the release of key macroeconomic numbers, monthly derivatives expiry, and global cues. They also expect the market to react to comments made by US Federal Reserve Chair Jerome Powell.
Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services Ltd, believes that the market will witness a gradual upswing with a focus on individual stocks. As the week progresses, attention will shift to the monthly F&O expiry and global events. On Monday, the market is expected to respond to Powell's speeches at the Jackson Hole Symposium.
During his speech, Powell hinted at a potential interest rate cut during the September meeting. He emphasized the need for policy adjustments, stating that "the time has come." Naveen Kulkarni, Chief Investment Officer at Axis Securities PMS, explains that while the market has been anticipating this rate cut, there is a possibility for even more cuts due to weak job data. However, Powell remains optimistic about the US economy and believes that the chances of a recession are low. This means that the rate cuts will likely align with market expectations, and there is a possibility for less aggressive cuts.
Following Powell's speech, US markets closed higher on Friday, and traders are anticipating some volatility in the coming days due to the monthly F&O expiry. Last week, the BSE benchmark saw an increase of 0.80 per cent, while the NSE Nifty closed with a gain of 1.1 per cent.
Vinod Nair, Head of Research at Geojit Financial Services, explains that the Indian market saw a recovery rally this week, boosted by positive economic data from the US and a decrease in crude prices. Additionally, news of ceasefire talks between Israel and Hamas also contributed to the positive sentiment.
In terms of institutional activity, foreign investors withdrew Rs 1,608.89 crore from equities, while domestic investors continued their buying streak and purchased Rs 13,020.29 crore worth of stocks last week.
Looking ahead, Ajit Mishra, Senior Vice-President of Research at Religare Broking, states that investors will keep an eye on economic data releases, such as GDP figures and infrastructure output. India is scheduled to release the first quarter GDP figures on August 30, along with the production of the infrastructure sector for July.
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