Earnings, Fed interest rate decision, macro data to dictate market trend this week

The U.S. Fed’s interest rate decision, national macro data announcements and ongoing quarterly earnings are some of the main factors that will boost stock markets in a holiday-shortened week, said the analysts.

In addition, monthly auto sales figures and LIC’s IPO will also remain a focus, they added.

Equity markets will remain closed on Tuesday for Id-Ul-Fitr (Ramzan Id).

“The market should start this week on a gloomy note after a sharp drop in the US market, then the focus will turn to the outcome of the US FOMC meeting, which is crucial in the context of record inflation and concerns for The FOMC meeting is scheduled for Wednesday and the Indian market will react to it on Thursday.

“Global indices will dominate as, in addition to the FOMC meeting, there will be a release of BOE interest decisions, US payrolls numbers and global PMI numbers,” said Santosh Meena, Head of Research at Swastika Investmart Ltd.

Commodity price developments, the dollar index and the behavior of FIIs will remain other key factors, he added.

Domestically, we will have monthly auto sales numbers as there will be plenty of Q4 revenue including Reliance, Britannia, HDFC Ltd, Adani Enterprises, Heromoto Corp, Tata Steel, Titan, Kotak Mahindra Bank, Tata Power, Meena said.

“This week is a shortened holiday period and it will be critical as some of the important events and data are lined up. Participants will first react to auto sales numbers. On the macro front, markets will look to the PMI manufacturing and services PMI data for May 2 and May 5, respectively Insurance giant LIC’s highly anticipated IPO will open for subscription on May 4. On the global front, the result of the US Fed meeting will be the focus,” said Ajit Mishra, VP Research, Religare Brokerage.

The country’s largest life insurer, LIC, on Wednesday set the price range at Rs 902-949 per share for its initial public offering (IPO) of Rs 21,000 crore, which will open for subscription on May 4.

Last week the Sensex fell 136.28 points or 0.23%.

Yesha Shah, head of equity research at Samco Securities, said: “Globally, the FOMC meeting will be in the spotlight. As market participants try to read between the lines of the Fed’s policy actions, any surprises can lead to panic reactions in global markets. .

“Back home, the largest IPO, LIC, is about to go public. Given the gigantic size of the issuance, the IPO is expected to test investors’ appetites and the liquidity funneled to the IPO may slightly influence secondary markets.”

Shah further added that monthly auto sales figures are likely to attract the attention of investors looking to anticipate future trends in auto stocks.

“All of these events associated with the current earnings season can make markets choppy this week,” Shah said.

The markets would also follow the investment pattern of foreign institutional investors, the movements of Brent crude and the rupee.

“Going forward, volatility is likely to continue as the focus will be on central bank policy meetings at both the US Federal Reserve and the Bank of England. Apart from that, a slew of publications from economic data, monthly auto sales data and the current earnings season will keep investors busy.

“The mother of all IPOs – LIC will also hit Dalal Street on May 4, 2022, which may remove liquidity from the market and put some selling pressure,” said Siddhartha Khemka, Head of Trade Research at retail, Motilal Oswal Financial Services Ltd.

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