RBI interest rate decision, global trends drive market: analysts: Rediff Moneynews

New Delhi, Aug 4 (PTI) Analysts said the RBI’s interest rate decision, macroeconomic data and global trends will drive market movements this week.

In addition, trading activity by foreign investors and the latest batch of Q1 earnings announcements will also set trends on the stock markets.

The HSBC PMI (Purchasing Managers’ Index) for the services sector is due to be published on Monday.

“This week, all eyes will be on global markets as we see the first major signs of weakness after a long period of stability. This will be a test of the strength of the Indian market, which has remained resilient on the back of strong domestic liquidity and improved macroeconomic outlook despite global headwinds and valuation concerns,” said Santosh Meena, Head of Research, Swastika Investmart Ltd.

Meena added that on the domestic front, the RBI’s monetary policy announcement on August 8 will be important.

“The final batch of first-quarter earnings will drive stock moves. In addition, institutional flows will play a key role in market dynamics,” he said.

Bharti Airtel, BEML, ONGC, NHPC, Life Insurance Corporation of India and MRF will announce their financial results this week.

“Going forward, the chances of further consolidation seem elevated on the back of premium valuations, weak Q1 earnings and ongoing global market consolidation. The RBI policy meeting this week could provide some clues on the interest rate outlook, while expectations for now are for status quo,” said Vinod Nair, head of research at Geojit Financial Services.

Amid widespread selling pressure, the 30-share BSE Sensex fell 885.60 points or 1.08 per cent to end at 80,981.95 on Friday. The broader NSE Nifty fell 293.20 points or 1.17 per cent to end at 24,717.70.

Price movements in the global oil benchmark, Brent crude, and the rupee-dollar exchange rate trend will also determine market trends.