The BSE Sensex lost 2,943 points last week, while the NSE Nifty50 closed at a level of less than 15,300 in what was its worst weekly decline in two years, amid concerns about the US recession and global monetary tightening. Analysts say the focus of Indian stock markets is expected to shift to global trends as no major domestic event is scheduled for next week, while foreign fund movements and crude oil prices are monitored, analysts said, adding that monsoon progress would also be monitored.
“Unless a major domestic event occurs, global signals will continue to dictate the trend. Attendees will also monitor the trend of COVID cases and monsoon progress,” said Ajit Mishra, VP – Research, Religare Broking Ltd.
“Relentless selling by FIIs is a major concern for the Indian markets. The movement of the rupee and the development of the monsoon will be other key factors for the market,” said Santosh Meena, head of research at Swastika Investmart Ltd.
Here are the main triggers that will affect traders this week:
US markets in pictures
Investors will closely monitor US economic data in the coming week to gauge the state of the economy as fears mount that the Federal Reserve’s aggressive rate hike could send the United States into a technical recession over the next 12 months. can push.
Investment trends by foreign institutional investors and the movement of the rupee against the dollar will also be closely monitored by investors. Foreign institutional investors remained net sellers in the capital market on Friday as they sold shares worth Rs 7,818.61 crore, according to stock market data. The rupee closed the week at 78.05 against the dollar.
RBI MPC Meeting Minutes
Macroeconomic observers will be hooked on the minutes of the June policy meeting of the monetary policy committee, due to be released next week, for clues to the rate-setting panel’s next step. While May’s CPI inflation data should provide some relief to the MPC on the inflation front, the panel is likely to continue with more rate hikes.
The progress of the southwest monsoon to India, after making landfall in the last week of May, has been disappointing so far. Slow progress and sporadic rains in many agriculture-heavy regions of the country could further shake investor confidence in the economy, as well as raise concerns that inflation will remain higher for an extended period of time.
Helpful Technical Perspectives
Technically, Nifty has surrendered the key support from the 15,700 level and there is a risk of further downside effects, with 15,000 being a key psychological support level, then 14,500 is the next major support, therefore 15,000-14,500 is a key demand zone where we have a can expect soil formation. However, on Friday’s trading session, Nifty formed a Doji candlestick formation followed by a sharp sell-off, therefore the low of the Doji candle placed at the 15,183 level will act as an immediate support level. On the upside, 15,500/15,700 are immediate and critical resistance levels.
“Bank Nifty has fallen below the psychological level of 33,000, but 32,250-32,000 is an immediate and critical demand zone where we can expect a backlash; below that, 30,500 will be the next support level. On a positive note, 33,000 is an immediate hurdle and 33,750-34,000 is the next feeding zone. Looking at the derivative data, the long exposure of FIIs in the index future is a multi-year low of 13 percent, while the put-call ratio is at 0.75, which is why the overall market seems oversold,” Meena said. . .
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