Market Next Week: Global trends, crude oil, monthly expiry, FII movement key drivers for Indian equities, say analysts

The market is likely to continue its volatile trend next week and will mainly be driven by global trends, crude oil movement, June auto sales, and foreign institutional investments, analysts said. They added that the benchmark indices may also face volatility amid the scheduled monthly derivatives expiry.

Moreover, the movement in the rupee and the progress of the monsoon would also be watched by investors, the market experts noted.

“We expect volatility to remain high next week as well, thanks to the scheduled expiry of June month derivatives contracts,” Ajit Mishra, VP - Research, Religare Broking Ltd said in his note.

Besides, the performance of the global indices especially the US, crude movement and monsoon progress, etc. will remain on the radar, Mishra also said, adding that the next week also marks the beginning of a new month so the auto numbers will also start pouring in from July 1, 2022.

The coming week has a host of events arriving which could affect the mood of the market, Yesha Shah, Head of Equity Research, Samco Securities said.

“Globally, investors will keenly analyze the US quarterly GDP growth rate numbers. The USA would officially enter into a recession if they post a negative growth and thus this could have a spill-over effect on global markets, Shah added in her note.

"Indian markets managed to recover from lower levels after two weeks of sharp cuts thanks to a recovery in global markets and a cut in commodity prices. It seems that this recovery may see a further extension and we can expect a decent rally in the coming days in equity markets," Santosh Meena, Head of Research, Swastika Investmart Ltd told to PTI.

"Apart from F&O expiry, monthly auto sales numbers and monsoon development will be important triggers," Meena said. Crude oil, rupee movement and FIIs' behaviour will be other important factors, he added.

Rahul Shah, Co-Head of Research at Equitymaster, said “The pullback in the Indian indices this week seems more like a relief rally than a full-fledged recovery. Global macros continue to remain challenging and may continue to act as a drag on Indian stocks as well.”

However, with valuations coming off from their highs, the risk reward from a 2 to 3-year perspective is definitely looking much better, he said and added that this is a good time to start accumulating fundamentally strong stocks as long as not paying too much premium for quality and stability.

Markets last week traded volatile but finally ended with a gain of over 2.5 per cent, taking a breather after the recent fall. The 30-share BSE Sensex jumped 1,367 points or 2.66 per cent last week after two straight weeks of losses. The broader Nifty gained 405.75 points or 2.64 per cent.