What are the major stock market cues for the coming week starting on 13th June?

Here are some of the major cues to watch out for in the coming week starting on 13th June?

a) The previous week saw a lot of pressure. Nifty closed with losses of -2.3% on apprehensions of higher inflation and a hawkish stance by the RBI. In addition, the mid-cap index fell -0.8% while the small cap fell -1.1%. The trend is likely to continue in the coming week, with the large caps taking the brunt of the fall in the market.

b) Paint companies are facing major risks of down trading wherein customers are shifting to lower priced alternatives from the unorganized sector. This is more so in decorative paints. The IPO market, meanwhile is likely to remain under pressure with LIC losing 25% since listing. Most other IPOs have put their public issue plans on hold for now.

c) The big impact of the US inflation at 8.6% with be seen this week. Last week, the Dow and NASDAQ tumbled after that. Focus will shift to the FOMC statement on 15th June with a strong possibility of rates being hiked by 75 basis points instead of 50 bps. The dollar index (DXY) was above 104 and will hold the key to currency strength.

d) Crude will remain in focus for the week after Brent crude touched $124/bbl, but tapered later on. This also led to the rupee closing at an all-time low of Rs77.88/$ for the week and was only saved by the RBI intervening at Rs78/$ levels to defend the rupee. Of course, the Dollar Index will also have a bearing on the rupee value this week.

e) In big macro data, IIP was impressive on Friday at 7.14% but the big story will about CPI and WPI inflation. Both are expected to taper this month due to base effect but any negative surprises will not go down well with the market. Of course, don’t miss out the trade data for May 2022, with the trade deficit likely to be above the $23 billion mark.

f) In terms of F&O indicators, the data is indicating at the range moving down on the lower side to around 15,800 on the Nifty. On Monday, the Nifty is expected to open weak and could even dip below the 16,000 levels. The writing is visible in 16,700 call and writing is also visible in 15,800 puts giving fresh hints at weakness. 15,800 may be key supports.

g) In global data points, the US focus will be on FOMC meet, May PPI, API crude stocks, retail sales, housing starts, jobless claims, IIP, Powell speak. In rest of the world data, the focus will be on EU IIP, Trade, wage growth, inflation; Japan IIP, machinery orders, BOJ meet; China IIP, retail sales, Housing price index.

Needless to say, US FOMC and India inflation will be the real drivers of sentiments.