Macro-economic data, auto sales and a continued rise in COVID-19 cases – here’s what will move Sensex and Nifty 50 this week
- The benchmark Nifty and
Sensexregistered an increase of over 1% in the last week, as opposed to an over 4% increase in the week before.
- India-China border tensions, profit booking and the rising COVID-19 cases across the country kept the Indian markets on the tenterhooks.
- Macro-economic data, auto sales and COVID-19 cases are likely to have an impact on the market this week.
While Nifty closed the week at 10,383, up 1.36% compared to the previous week, Sensex closed at 35,171 — up by 1.27%. However, it was lacklustre performance since both the stock indices ended the June 19 week with an increase of over 4%.
SGX Nifty, which is a Nifty derivative market-based in Singapore, was down by over 116 points or 1.13% ahead of the market trade on Monday. It is usually considered as one of the first hints of the market direction for the subsequent day.
What will move Sensex and Nifty this week
The Indian economy is predicted to go into a recession this year. Rating agency Standard & Poor (S&P) has forecast that the Indian economy will contract by 5%.
“India's economy is in deep trouble. Difficulties in containing the virus, an anaemic policy response, and underlying vulnerabilities, especially across the financial sector, are leading us to expect growth to fall by 5% this fiscal year before rebounding in 2021,” S&P said in a report.
However, the Indian markets have so far been more optimistic, increasing by 38% after the crash in March.
Geopolitical tensions could keep markets on the tenterhooks
After seemingly brushing aside the India-China border tensions in the June 19 week, the Indian markets remained cautious in the June 26 week.
The rising US-China tensions, China’s threat to back away from its commitment to purchase US farm goods and the rising COVID-19 cases in the US could dampen global market sentiment — which could result in a spillover effect on Sensex and Nifty.
Auto sales and PMI data
Auto sales, an indicator of the demand in India’s economy, are also likely to move markets, this week. Auto sales data for the month of June is expected to trickle in from Wednesday, 1 July onwards.
Purchasing Managers Index (PMI) data is also likely to be released this week, which will give us a glimpse at the state of the Indian economy in terms of demand, inventory, employment, product and supplier deliveries.
March quarter earnings this week
Companies like MRF, ONGC, Bharat Forge, Bharat Electronics, Central Bank of India, Balaji Telefilms, GMR Infrastructure and others are scheduled to release their March quarter earnings this week.
It’s also worth noting that IRCTC has not released its March quarter earnings as scheduled on June 26. The company has not announced a new date for the meeting yet.
What the Bulls and the Bears are betting on
Based on data obtained from NSE, the majority of the open interest in both Put and Call is between the 9,800-11,000 range, suggesting higher volatility.
HCL Tech, InfoEdge, Biocon and their peers may be safe stocks to hide for the rest of 2020
Better safe than sorry – the COVID-19 crisis could go either way and these are the shocks and surprises to prepare for
IndusInd Bank, Godrej, Apollo Tyres – some of the biggest gainers in June are stocks where promoters have raised stakes
- MP: Shops to be shut for 3 days in case of COVID-19 violations
- Fighting COVID-19, Noida cops step up for plasma donation
- Hand Sanitizer brands boosted their ad volume on TV by 105% during the lockdown: TAM
- Heatwaves worldwide have become longer and more common over last 70 years
- Unacademy beefs up its medical entrance programme with a $50 million acquisition of PrepLadder