InvestorQ : What in your view are the major stock market triggers for the coming week starting on 07th February?
Rutuja Nigam made post

What in your view are the major stock market triggers for the coming week starting on 07th February?

diksha shah answered.
1 year ago

Here are some of the key triggers to watch out for in the coming week.

· It was a week that the markets reacted positively to the Union Budget with the Nifty up 2.5%, mid-caps up 2.14% and small caps up 1.87%. With the Budget out of the way, the big trigger this week will be the monetary policy on 09-Feb. Markets are pencilling in a repo rate hike for sure and a less likely possibility of a rate hike in the policy.

· Debt and oil will hold the key to the week. Indian Bond yields crossed 6.9% after Budget announced 25% higher borrowings, even as US bond yields cross 1.9%. The other big macro variable this week will be oil with Brent already at a 7-year high of $93/bbl. India still relies on oil imports for meeting 85% of daily needs.

· One reason for the oil price spike has also been the geopolitical risk in the form of a worsening Ukraine situation. The Ukraine stand-off is also leading to a spike in price of oil and gas. As EM risks mount, FPIs again sold Rs.7,700 crore of equities in first week of February on top of $4.46 billion selling in Jan-22 and $10 billion in last 4 months.

· Key large cap results this week include Bharti, ACC, Bosch, Power Grid, Hero Motocorp, Hindalco, M&M, Divi’s Labs, ONGC. Keep an eye on important mid-cap numbers of PB, Nykaa, Zomato, Tata Power, Castrol, Escorts, Amara Raja, Alembic, Sun TV and Trent. In IPO news, Vedant IPO closes on 08-Feb while Adani Wilmar lists on the same day.

· In macro data cues, IIP data for Dec-21 to be released on 11-Feb. In addition, key US data points include Vehicle Sales, MBA Mortgages, Jan Inflation, jobless claims and Fed Monetary Policy Report. For rest of the world, major data points are Japan Household Spends, PPI, Machine Tool Orders; China Caixin PMI Composite and Vehicle Sales.

The options data is pencilling in a range bound Nifty in the narrow range of 17,500 to 17,800 for next week, with the monetary policy being the big trigger.