Earnings, elections, macro data among 8 factors that may guide market this week

NEW DELHI: Domestic equity market settled in positive territory last week, with the BSE benchmark Sensex index edging up 0.5 per cent to 38,862.23 and Nifty adding 0.36 per cent to 11,665.95.

This was the seventh consecutive weekly gain for Sensex and eighth for Nifty.

The Reserve Bank of India’s rate cut, rupee, crude oil and macroeconomic numbers such as PMI prints were the key factors that influenced market last week.


In the coming week we will have similar factors steering the market. "The sessions will be dominated by factors such as crude oil and movement in rupee. Domestic data such as manufacturing and industrial numbers and inflation will also be seen," said Mustafa Nadeem, CEO, Epic Research.

Here's a look at the factors that can influence market proceedings next week:

Fourth quarter earnings: Indian companies will start releasing their March numbers from this week. Infosys and TCS are two heavyweights that will release their numbers on Friday.

Lok Sabha election: The first phase of Lok Sabha election will begin on April 11. Even though the results are to be declared on 23 May, the market cannot shrug off the effect of ongoing political discourse and sentiment.

March retail inflation numbers: The retail inflation print for the month of March will be released next Friday. Retail inflation rose to 2.6 per cent in February after four months of continuous decline. The RBI on Thursday revised the projection on inflation downwards to 2.4 per cent in the fourth quarter of the financial year 2019. A softer inflation print will strengthen the hopes of another rate cut by the RBI.

February IIP: Another important macroeconomic print, February Industrial Production numbers, will be released on the same day. Industrial output growth stood at 1.7 per cent in January on account of slowdown in the manufacturing sector. It may see an uptick and is likely to come to 2 per cent, economists say.

ECB rate decision: The European Central Bank (ECB) will announce its policy outcome on Wednesday. As per Reuters poll, the central bank is going to delay any interest rate hikes further into next year as euro zone economic growth and inflation prospects have dimmed.

Brexit: The chaos around Brexit is showing no signs of ebbing. British Prime Minister Theresa May has requested to the European Council to delay Brexit until up to 30 June. Focus now shifts to a meeting next week where EU leaders will discuss a proposal to offer Britain a flexible extension of up to a year, Reuters reported.

Global macro: March inflation prints of China and America and trade balance data of China are among important numbers markets across the globe will observe. Minutes of the March Fed policy meeting will also be watched for references to the new patient approach.

Technical indicators indecisive: Nifty on Friday formed an indecisive Spinning Top candle on the daily chart. On a weekly basis, it formed a long-legged Doji. The two charts suggest traders were clueless a week before of seven phase elections kick off. The near-term oscillators are in sell mode, but they are in buy mode on a medium-term basis, said Arun Kumar, Market Strategist at Reliance Securities. "The support for the week would be seen at 38,280/11,480 levels while the resistance would be at 39,580/11,900 levels," said Vaishali Parekh, senior technical analyst at Prabhudas Lilladher.