What are the major trading and investment triggers for the stock markets in the week commencing on 01 June 2020?

Markets will start next week with an overhang of the 1800 points rally in the Sensex last week. GDP and core sector may have been week but the focus will now be on looking ahead to the post-lockdown scenario and hope for growth. Global cues will be critical.

· GDP growth at 3.2% for Q4 was better than expected but the real focus will now be on recovery post COVIDI-19 lockdowns and GDP growth in Q3 and Q4

· Core sector recorded (-38%) de-growth with cement and steel seeing output cuts of nearly 85%. That would weigh on cement and steel stocks

· PMI manufacturing and services with hold the key. April PMI Manufacturing dipped to 27 and PMI Service to 5.4% and May is only expected to be slightly better

· Oil demand and supply set to balance in June with surplus of 12 million bbl absorbed. Oil extractors and refiners may stand to benefit in the bargain.

· Extension of lockdown was anticipated but markets will be happy with the timetable for unlocking some key services

· China worsening relations with the US and with India could be the overhang this week with China expected to retaliate hard on removal of special status for Hong Kong

· Global stimulus could be the big market trigger as nations committed $8 trillion stimulus with 55% coming from the US and Japan

· COVID-19 cases are rising with average number of cases going up from 4000 per day to nearly 8000 per day. This could only get worse as the lockdown is lifted

· Monsoons arrive in Kerala 2 days ahead of schedule and Met expects normal rainfall this year; a boost for Kharif output and to keep inflation in check

· Corporate results of stock market heavyweights like L&T, SBI, Britannia, Aurobindo, Interglobe and BPCL could hold out hope for a revival

· Agricultural growth at 4% in 2018-19 will be a big boost for agri, agrochemicals, hybrid, two wheeler and farmer oriented stocks

· Markets will closely be watching some of the key global data points like global PMI manufacturing and PMI Services, US jobless claims, trade, EU retail sales etc

With the expiry over, the focus shifts to COVID-19 and the morale boosting measures.