InvestorQ : What are the major stock market cues that you foresee for the coming week starting on 29th August?
shrinidhi Rajan made post

What are the major stock market cues that you foresee for the coming week starting on 29th August?

diksha shah answered.
2 months ago

The coming week will be a truncated week with Wednesday August 31st being a trading holiday on account of Ganesh Chaturthi. The major trading cues for the coming week can be broadly summarized as under.

· The Nifty and Sensex closed the week in the red after 5 weeks of gains. Nifty was down -1.12% for the week. However, the Mid-cap index gained 0.35% for the week and small cap was up 1.47%. Large cap stocks were impacted by the uncertainty over the Jackson Hole speech by Jerome Powell, while the mid-cap stocks were less vulnerable to it.

· Despite the markets bracing for a 75 bps rate hike by the Fed in September FOMC meet, the FPIs continued to invest enthusiastically into Indian equities. In fact, for the first four weeks of August, the FPIs were net buyers in equity worth Rs49,254 crore or $6.2 billion. This is a sharp bounce after consistent FPI selling between Oct-21 and Jun-22.

· The Adani group stocks are likely to be in the limelight for 3 reasons this week. Firstly, the high leverage warning by Fitch and S&P Global will weight on the stocks. Markets will also watch what happens to the NDTV regulatory approvals. Lastly, the open offer for ACC and Ambuja shareholders opened on Friday and is open all the way till the second week of September. The response will be closely watched.

· There are no fresh IPOs opening or listing this week. However, the news flows have been good subscription and listing. Last week, Syrma SGS Technology listed at 42% premium to the issue and closed the day at upper circuit on Friday. The Dreamfolks Services IPO got subscribed 56.68 times. These bode well for the TMB IPO opening on 05th Sept.

· Big macroeconomic data points are expected this week. Q1FY23 GDP will be announced on Wednesday along with core sector for July. GDP growth is pegged at around 15.2% on low Q1FY22 base number. Core sector is expected to better 12.7% June number. PMI for manufacturing and services is expected to show high frequency improvement.

· This will be a week for key deficit data too. Fiscal deficit for July will be announced on last day of August with signals if there will be spillage over 6.4%. Preliminary trade data for August 2022 will be put out on September 02nd and that assumes importance with record trade deficit of $30 billion in July and forex reserves down to $564 billion.

· IT stocks are expected to be again under pressure in the coming week after a number of negative major headwinds were visible in the previous week. Large IT companies have been cutting back on bonuses and variable pay which has put pressure on stock prices. This has soured the market sentiments around IT stocks.

· Key data points from US markets to focus on JOLTS Job openings, FOMC speak, API stocks, jobless claims, PMI, non-farm payrolls, factory output. Other data points from rest of the world include EU CPI, PMI, jobless rates ; Japan Industrial Output, Retail Sales; UK PMI, HPI; China PMI.