As the equity markets prepare for a holiday-shortened week, analysts anticipate that global trends, trading activities from foreign investors, and domestic economic data will significantly influence market movements. The Indian stock exchanges will observe a closure on Wednesday in observance of Mahatma Gandhi Jayanti.
Santosh Meena, Head of Research at Swastika Investmart Ltd, highlighted that the focus will be on the activities of Foreign Institutional Investors (FIIs), particularly following a notable surge in FII inflows in September, marking the highest for Indian equities this year. Key indicators, such as fluctuations in commodity prices, the US dollar index, and pivotal macroeconomic releases from the United States, will also be crucial in determining market direction.
In terms of domestic influences, upcoming monthly auto sales figures and quarterly earnings reports from various companies are expected to drive stock-specific dynamics in the near term. Meena pointed out that Purchasing Managers’ Index (PMI) data for both manufacturing and services sectors would play a significant role in shaping trading patterns.
Recent reports show that the BSE benchmark index rose by 1,027.54 points or 1.21%, while the NSE Nifty increased by 388 points or 1.50% last week. The BSE Sensex reached an impressive intra-day high of 85,978.25, while the NSE Nifty marked an all-time peak of 26,277.35 on Friday.
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services Ltd, expressed optimism about continued positive momentum in the markets, primarily driven by frontline stocks. “Going forward, global factors will be key, especially with no major domestic events on the horizon,” stated Ajit Mishra, Senior Vice President of Research at Religare Broking Ltd.
With auto sales data set to be released on October 1, along with crucial economic indicators such as the HSBC India Manufacturing PMI and Services PMI, traders are urged to stay vigilant. Mishra also noted that trends in foreign fund flows and crude oil price movements will be closely monitored as they could significantly affect market sentiment.
Vinod Nair, Head of Research at Geojit Financial Services, remarked that investors are keenly anticipating Q2 earnings reports, expecting a positive shift in the earnings outlook. He attributed the recent market upswing to a favorable response to the Federal Reserve’s rate cuts and stable economic indicators, which have spurred foreign investments and invigorated domestic markets. Additionally, announcements of economic stimulus measures from China have contributed to heightened investor confidence and have led to marked gains in global markets, particularly across Asian indices.
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