US Fed FOMC, RBI MPC, auto sales, Q2 earnings among others may dictate markets trend in coming week – know what analysts say

Market Next Week: The domestic market in the coming week is likely to be critical on the back of multiple triggers, including the US Fed FOMC (Federal Open Market Committee) meeting as well as a special monetary policy meeting called by the Reserve Bank of India, the analysts stated in their expectations.

Among other factors that may influence the markets next week are Q2 earnings, auto sales, foreign investors’ flow, currency, and crude oil movements, the analysts further expect.

“We have two important events that is US Fed meet and a special MPC monetary policy review meet scheduled during the week. Besides, important high-frequency data such as October auto sales numbers shall also be in focus,” Ajit Mishra, VP - Research, Religare Broking said.

Similarly, Pravesh Gour, Senior Technical Analyst, Swastika Investmart Ltd said, “The market will also have an eye on the unscheduled RBI MPC meeting. We are heading toward the last batch of Q2 earnings, which will lead to stock-specific movement. October auto sales numbers will be important because they will tell us about festival demand.”

Apart from this, the institutional flows will play a vital role because foreign investors have turned from sellers to buyers while domestic institutional investors are also giving their participation on the positive side, the Senior Technical Analyst, Swastika Investmart also said in his comment.

As the earnings season would gain pace, prominent names like Bharti Airtel, Larsen and Toubro, Tata Steel, Sun Pharma, Hero MotoCorp, HDFC, Cipla, and Titan will unveil their numbers along with several others, the market expert at Religare Broking said in his comments.

The Indian markets have been inching gradually higher however a mixed trend across the index heavyweights keeping the momentum in check.

Technically, the benchmark index Nifty50 may maintain the positive tone till it manages to hold 17,400 and inch gradually toward the 18,100+ zone, Mishra expects. “We feel banking might take a breather around its record high and other sectors would fill in on a rotational basis.”

The VP – Research at Religare Broking also recommended, “Traders should continue with the “buy on dips” approach with a focus on overnight risk management.” 

“If we look at the derivative data, then FIIs are starting the November series with 57 per cent long positions in index futures. The put-call ratio is at a 1.23 level. Overall, derivative data is indicating a neutral to positive bias, but the market won't have the support of short covering,” Gour mentioned.

The markets extended recovery in a holiday-shortened this week and rose over a percent amid mixed cues. The beginning was on a strong footing on the special Muhurat Trading session however a mixed trend across the index majors capped movement in the following sessions.

Finally, the Nifty index closed at 17,786.80 and Sensex at 59,959.85.  Among the sectoral pack, auto, metal, energy and realty posted decent gains while FMCG and IT traded subdued. Meanwhile, the broader indices traded mixed as midcap ended higher by a per cent and smallcap settled nearly flat.