Week Ahead: Q4FY24 Results, FII activity, macro data, global cues among key market triggers this week

The banal marketplace experienced volatility passim past week, yet ending astir unchanged amid conflicting signals. While the wide sentiment was affirmative initially, fluctuations successful planetary markets coupled with declines successful definite large stocks offset overmuch of the gains. 

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Despite this, the Nifty 50 managed to scope a caller grounds precocious of 22,794.70 earlier settling astatine 22,475.80. Sector-wise, financials, auto, and vigor saw gains, but broader indices closed with flimsy losses, taking a intermission aft caller gains.

The cardinal benchmark indices maintained a level trajectory connected each days, marking the 4th consecutive week of small movement. At the adjacent of trading, the Sensex recorded a marginal uptick of 147.99 points oregon 0.20 per cent, reaching 73,878.15, portion the Nifty 50 edged up by 55 points oregon 0.25 per cent to settee astatine 22,475.80.

On the play front, the BSE benchmark climbed 147.99 points oregon 0.20 per cent. The NSE Nifty precocious 55.9 points oregon 0.24 per cent. The benchmarks added astir 0.25 per cent each this week, their 2nd consecutive play rise.

The Nifty volatility scale roseate to a two-month precocious astatine close. The precocious weightage financials gained much than 2 per cent, led by non-bank lender Bajaj Finance, which jumped 3 per cent aft the Reserve Bank of India (RBI) lifted a five-month prohibition connected immoderate of its lending products.

IT stocks dropped 2.25 per cent, dragged by an 8.5 per cent diminution successful HCL Technologies aft the bundle services institution missed March 4th gross estimates, making it this week's apical loser connected the Nifty 50 index.

The expectations of higher-for-longer US involvement rates aft the latest US Federal Reserve argumentation decision person been weighing connected India's IT sector, arsenic elevated rates person resulted successful little lawsuit spending the US, a cardinal market.

"A marginally amended than anticipated Q4 net and a correction successful lipid prices led to a affirmative commencement to the home marketplace during the week. However, a mixed inclination successful the planetary marketplace aft the merchandise of a presumption quo Fed argumentation with caution astir sustaining a precocious ostentation inclination led to a broad-based correction successful the home market,'' said Vinod Nair, Head of Research, Geojit Financial Services.

The affirmative commentary from the car companies connected caller measurement numbers led the assemblage to outperform. Stock-specific enactment was disposable successful banks and the powerfulness assemblage connected relationship of affirmative Q4 results and accrued powerfulness demand, according to the analyst.

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‘’Moving forward, the ongoing results play volition beryllium a cardinal detrimental origin for investors to align their portfolios…We expect a grade of consolidation successful the marketplace owed to costly valuations and immoderate election-led jitters,'' said Nair.

In the coming week, the buzz volition instrumentality successful superior markets arsenic respective archetypal nationalist offerings (IPO) and listings are slated crossed the mainboard and small-and-medium enterprises (SME) segment. The week volition beryllium captious from the home and method constituent of presumption arsenic investors volition planetary indicators and the latest firm results.

Overall, analysts expect volatility to proceed implicit quarterly results contempt the ongoing uptrend successful markets. Nifty 50's absorption is expected successful the 22,750-22,900 portion successful lawsuit of further upward movement. Experts counsel traders to see hedged positions and await clearer signals earlier making large moves.
 

Here are the cardinal triggers for banal markets successful the coming week:
 

Q4 Results

Domestically, the adjacent batch of Q4 net reports volition thrust stock-specific movements, Dr Reddy's Laboratories, Hero MotoCorp, Larsen & Toubro (L&T), Bharat Petroleum Corp Ltd (BPCL), Hindustan Petroleum, State Bank of India (SBI), Eicher Motors, and Tata Motors are immoderate of the large names successful the list.

9 caller IPOs, 4 listings to deed D-Street

In the mainboard segment, Indegene IPO volition unfastened for subscription connected May 6, while, TBO Tek IPO and Aadhar Housing Finance IPO volition unfastened for bidding connected May 8. In the SME segment, Winsol Engineers IPO and Refractory Shapes IPO volition unfastened for bidding connected May 6. 

Finelistings Technologies IPO and Silkflex Polymers IPO volition unfastened for bidding connected May 7. TGIF Agribusiness IPO volition unfastened connected May 8 and Energy Mission Machineries IPO volition unfastened connected May 9. Among the ongoing IPOs, Slone Infosystems IPO volition adjacent for subscription connected May 7.

Among listings, shares of Storage Technologies Racks and Rollers, Sai Swami Metals and Alloys, and Amkay Products volition debut connected BSE SME connected May 8. Shares of Slone Infosystems volition get listed connected NSE SME connected May 10. 

FII Activity

Foreign organization investors (FIIs) past week, offloading stocks worthy ₹2,115 crore and home organization investors (DIIs) were nett buyers, with the nett concern worthy ₹2,121 crore.  According to analysts, since the FIIs person continued to stay nett sellers successful the market, the sentiment has impacted the show of ample headdress stocks, prompting retail investors to publication profits.

‘’DIIs made up for the overseas capitalist income this week. Looking ahead, it's important to show the enactment of FIIs, particularly fixed their constricted holdings successful the Indian market,'' said Pravesh Gour, Senior Technical Analyst astatine Swastika Investmart Ltd.

Foreign portfolio investors (FPIs) snapped their April's selling streak and turned nett buyers successful Indian equities implicit debased US enslaved yields, however, the sell-off was seen continued successful indebtedness market. FPIs invested ₹1,156 crore worthy of Indian equities and the full outflow stands astatine ₹771 crore arsenic of May 3, taking into relationship debt, hybrid, debt-VRR, and equities, according to National Securities Depository Ltd (NSDL) data. 

The full indebtedness outflows basal astatine ₹1,727 crore truthful acold this month. ‘’The marketplace is astatine grounds highs. There has been a pre-election rally. It is not arsenic beardown arsenic successful the past. ⁠More than thing else, FPIs volition respond to changes successful the US enslaved yields. If the US enslaved yields autumn and the Indian system and markets bash good they volition crook assertive buyers, ‘’ said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Global Cues

Global marketplace indices chiefly US and UK ended the week connected a bullish enactment with Dow Jones and FTSE rising (+1.14 per cent) and (+0.90 per cent). US 10-year enslaved yields and the dollar scale are besides cooling off, which gives spot to the market. The US Federal Reserve held involvement rates dependable connected May 1 citing constricted advancement connected the ostentation nonsubjective (to attain the 2 per cent target).

In the coming week, the marketplace volition stay vigilant implicit the Bank of England argumentation and economical information from the euro zone. Economic information releases from China and the US, on with movements successful the planetary currency market, volition besides beryllium factors to consider.

‘’Attention volition beryllium connected net reports and planetary marketplace performance, peculiarly successful the US. The Dow Jones Industrial Average has seen important volatility implicit the past month, precocious surpassing the erstwhile plaything precocious of 38,700, though sustainability remains uncertain,'' said Ajit Mishra, SVP - Research, Religare Broking Ltd.

Oil Prices

International crude lipid prices settled little successful the erstwhile session, and posted their steepest play nonaccomplishment successful 3 months arsenic investors weighed anemic US jobs information and imaginable timing of involvement complaint cuts by the US Federal Reserve. The crude lipid inventory roseate by 7.26 cardinal barrels arsenic compared to an expected a autumn by 2.30 cardinal barrels.

Brent crude futures for July settled 71 cents lower, oregon 0.85 per cent, to $82.96 per barrel. US West Texas Intermediate (WTI) crude for June fell 84 cents, oregon 1.06 per cent, to $78.11 per barrel. For the week, Brent declined much than 7 per cent, portion WTI fell 6.8 per cent. 

The US Fed held rates dependable and said that precocious ostentation could hold complaint cuts. Higher involvement rates typically measurement connected the system and tin trim crude lipid demand. Investors were besides acrophobic that higher-for-longer borrowing costs would curb economical maturation successful the US, the world's starring lipid consumer.

Corporate Action

In the 2nd week of May, respective large companies and banks are trading ex-dividend, portion others whitethorn denote rights contented and different firm actions, according to BSE. Shares of large banks specified arsenic HDFC Bank, DCB Bank, Bank of Maharashtra, and UCO Bank portion different companies including HCL Technologies, Ramakrishna Forgings volition commercialized ex-dividend successful the coming week. Check afloat database here

Technical View

Pressure persists astir grounds precocious levels for the Nifty, with a adjacent beneath 22,400 perchance starring to further declines toward the 22,200-21,850 range. The crisp summation successful the India VIX volatility scale suggests caution contempt the ongoing uptrend, according to marketplace analysts.

‘’Resistance is expected successful the 22,750-22,900 portion successful lawsuit of further upward movement. While astir sectors are contributing positively but for IT, banking show is apt to heavy power marketplace sentiment. It's advisable to see hedged positions and await clearer signals earlier making important moves,'' said Religare Brokings' Ajit Mishra.

The Nifty has formed a imaginable double-top signifier adjacent 22,800. As agelong arsenic the scale holds supra 22,200, the bulls are apt to stay successful control. A breakout supra 22,800 could trigger a caller rally towards 23,000 and adjacent 23,300. A driblet beneath 22,200 could pb to selling pressure, according to Swastika Investmarts' Pravesh Gour.

Profit-taking emerged adjacent the intelligence level of 50000 successful Bank Nifty. However, the portion betwixt 48600 and 48400 is simply a beardown enactment country wherever buyers mightiness return. If the scale climbs supra 50000, cardinal absorption levels prevarication astatine 50500 and 51000. Conversely, a breach beneath 48400 could spot weakness widen towards 47400.

The Bank Nifty has precocious slipped beneath the important 49,000 level and breached an upward sloping absorption trendline, which antecedently provided enactment implicit the past 2 sessions. According to Arvinder Singh Nanda, Senior Vice President, of Master Capital Services Ltd, this diminution amounted to 308 points, bringing the scale to 48,924. It managed to clasp supra the 10-day EMA astatine 48,683, serving arsenic contiguous support. 

‘’Subsequently, the 21-day EMA astatine 48,270 is different level to watch, perchance offering enactment if tested. On the upside, contiguous absorption is expected wrong the scope of 49,200 to 49,300. Key enactment levels are positioned astatine 48,400 to 48,300, important areas to show for imaginable shifts successful marketplace sentiment,'' added Nanda.

Disclaimer: The views and recommendations supra are those of idiosyncratic analysts and broking companies, not of Mint. We counsel investors to cheque with certified experts earlier taking immoderate concern decisions.

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Published: 05 May 2024, 06:50 AM IST