Domestic GDP data, US jobs numbers, Nikkei are key factors this week
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Hyderabad: Investors will have a tread an uncertain path as the markets will continue to remain volatile — largely be dictated this week by macroeconomic data, foreign fund flows and global cues, experts say.
The key domestic factors which could move markets in India will include the progress of monsoon, movement of the rupee against the dollar, and auto sales numbers. The global factors inclu-de oil price movement and the release of US jobs data on Friday, which could provide clues about US Federal Reserve’s policy stance on the long-expected hike rate.
India’s GDP data for the June quarter will be released on Monday. The Nikkei India manufacturing PMI for August 2015 is due on Tuesday (September 1). “Movement of index in the near term will depend on further reforms initiatives to be taken by the government and monthly auto sales numbers to be announced starting Sept-ember 1, 2015,” said Vivek Gupta, CMT director research, CapitalVia Global Research.
During the last week, the Sensex lost 973.69 points, or 3.55 per cent, and the Nifty 298 points, or 3.59 per cent. Though witnessing the one of the biggest falls in its history, the Indian markets staged a smart recovery. “The recent bout of weakness in the Indian stock market has largely come about on account of global factors,” Mr Gupta said, adding that the market breadth indicates that its overall health is strong.
According to international market experts, the focus of investors this week would be shift to macro data emanating from the United States. “There is a narrative out there that Janet Yellen’s Fed is looking for a reason to delay the rate hike; I don’t think that is necessarily the case," said Brad McMillan, chief investment officer for Common-wealth Financial in Waltham, Massachusetts.
“If we continue this run of strong data and if the market keeps coming back or at least doesn’t keep dropping, that makes September more likely.” A hike in US interest rate coupled with Chinese slowdown can have a disastrous impact on the emerging markets.
Though India’s economic fundamentals remain strong compared to peers, it is expected to witness the ripple-effect on the stock markets as investors turn risk-averse. “From an investment point of view, in such volatile times, the most prudent strategy is to stick with quality companies as they are relatively better pla-ced to weather economic challenges,” Reliance Sec-urities head research Hitesh Agrawal said.
( Source : dc correspondent/agencies )
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