RBI decision on interest rates, escalation of tension in Middle East to encourage investors

In the coming week, investors will closely monitor the RBI’s decision on interest rates, the escalation of the conflict in the Middle East and the trade activity of foreign investors. Moreover, analysts noted that the market will pay attention to the earnings of IT giants such as TCS, domestic economic data and fluctuations in the global benchmark Brent crude oil.

Experts said deepening tension in the Middle East and the outflow of foreign investors contributed to last week’s decline in stock markets, PTI reported. The next meeting of the Monetary Policy Committee (MPC) will be held on October 7, 2024. Reserve Bank of India (RBI). At its upcoming meeting, the central bank will discuss fiscal policy and key interest rates.

Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd further explained, “Q2 earnings season begins with TCS. Liquidity remains high on the domestic market, and there are signs of sector rotation from overvalued segments to areas with more attractive valuations. Additionally, commodity prices, the US dollar index and key US macroeconomic data will play a key role in determining the market direction. Geopolitical developments will also continue to be an important factor on the global front.”

Notably, the BSE Sensex index has fallen by 3,883.4 points or 4.53 per cent in the last week, while the NSE Nifty has fallen by 1,164.35 points or 4.44 per cent.

Vinod Nair, Research Director, Geojit Financial Services, said, “The new milestones of both Nifty50 and Sensex of 26,000 and 85,000 respectively were short-lived as tailwinds from the Middle East and flow of FII funds to cheaper Asian competitors influenced investor sentiment. Over the past week, these benchmark indexes have corrected by more than 4%.

Also Read: Zomato CEO Deepinder Goyal Won’t Return as Shark Tank India Judge, Says Swiggy ‘Ditched Me’

Investors in the market lost their fortune by Rs 16.26 lakh crore in five days of severe correction in the stock markets. However, the market outlook will be shaped by key macroeconomic data at the domestic and global levels, such as the Indian interest rate decision, UK GDP data, US FOMC (Federal Open Market Committee) meeting minutes, jobless claims and industrial production.