GDP data, Q4 earnings among 6 factors that will steer market this week

NEW DELHI: Following the impact of the government's fiscal measures, which included tariff changes for many commodities, the domestic market started last week on a negative note. Towards the end of the week, the market was able to recoup its losses following favourable retail earnings in the US and reduced FII selling.

Analysts said that though these measures by the government and RBI will help control inflation in the long-term, it will have a cascading effect on the market and economy in the short to medium-term.

This week, some of the issues of past week will continue to play in the market. Apart from that, the market will also start positioning itself for the policy meeting of the Reserve Bank of India where the Street expects another round of rate hike. Besides, auto sales data and PMI data will also be on investors’ radar. The week will also see a couple of fresh listings.

Below are key factors that will impact the market this week:

RBI policy meet

Though the meeting is scheduled in the second week of June, market will start positioning itself for any surprises. A rate hike is certain though te quantum is what will be important to watch out for.

“Market expects another 50 bps hike by the US Fed and 35 bps by RBI. If the tone of future monetary policy is moderate than anticipated, it will have a positive effect in the short to medium-term while a more hawkish stance will reduce the shelf life of the trend," said Vinod Nair, Head of Research at Geojit Financial Services.

Q4 earnings

As this is the last week to file earnings for India Inc., more than 1,300 companies are scheduled to report their quarterly numbers. Most of them are from broader markets. This will certainly induce volatility in the midcap and smallcap space in the next couple of days.

Auto sales data

Market will also keep an eye on auto sales data that will be released in the first few days of June. This will keep the auto block active. Analysts will also try to extrapolate the demand conditions and possible outlook of the segment from the data released by auto companies.

Macro data

A host of macro data including March quarter GDP growth rate will be announced this week. The market will react to the numbers, given that the third wave of the pandemic had some impact during the quarter. Any revision in the forward estimates will also be under radar.

The market will also keep an eye on purchasing managers index (PMI) data that will be released by S&P during the week. It will give an idea of demand at factory level.


Globally, US will release jobless claims data that will be eyed. Besides a couple of speech by Fed officials will also be interesting to track.

IPO listing

There are three issues that will be listed on the bourses during the week. The first one is luxury watch retailer Ethos and the second is eMudhra and the last speciality chemicals maker Aether Industries. Grey market premia for the first two stocks suggest they will likely be flat to negative listings. The third one commands some premium but it will be interesting to see if it can hold out.

Tech view

Last week, Nifty50 index closed marginally higher. The index continues to remain in oversold zones in the short term which indicates a mild reversal from here is possible. Major developed and emerging market indexes are also indicating near-term bottom formations. Furthermore, a positive reversal is visible in Bank Nifty, which has been outperforming the benchmark since rebounding from rising channel support.

“Based on these indicators, Nifty's downside appears to be restricted below 15,700 in the short term. Traders should therefore maintain a bullish bias with a hard stop loss below 15,700 levels. A convincing break above 16,400 can result in a retest of the 16,800-16,900 levels on the upside,” said Yesha Shah, Head of Equity Research, Samco Securities..