Markets to focus on RBI's interest rate decision, global trends, FPIs trading activity: Analysts

PTI Updated - October 01, 2023 at 10:58 AM.

Auto companies would also remain in focus amid monthly sales data announcement

RBI's interest rate decision, macroeconomic data, global trends and trading activity of foreign investors are the crucial factors to drive equity markets in a holiday-shortened week ahead, analysts said.

Markets would remain closed on Monday for Mahatma Gandhi Jayanti.

"While global cues will continue to dictate trends in local markets, focus will shift to RBI's monetary policy announcement on Friday. Although the market is expecting a status quo on interest rates, global concerns like rising US dollar index and bond yields coupled with surging crude oil prices continue to weigh on investors' minds.

"Further, persistent FII selling in emerging markets, including India, in September has taken a toll on markets," said Shrikant Chouhan, Head of Research (Retail), Kotak Securities Ltd.

Markets will closely monitor the Reserve Bank's monetary policy committee (MPC) meeting, which is scheduled from October 4–6, 2023, Pravesh Gour, Senior Technical Analyst, Swastika Investmart Ltd, said.

"Market participants will be keeping an eye on the movement of the rupee against the dollar and crude oil prices. Investments by Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) will also be monitored," Gour said.

Among domestic macroeconomic numbers to be announced this week are PMI (Purchasing Managers' Index) data for the manufacturing and services sector.

Auto companies would also remain in focus amid monthly sales data announcement.

FPIs (Foreign Portfolio Investors) turned sustained sellers in September, said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"The sustained selling has been in response to steady dollar appreciation which took the dollar index close to 107 and the steady rise in the US bond yields which took the US 10-year bond yield to around 4.7 per cent. The spike in Brent crude to USD 97 also weighed on FPI selling," Vijayakumar added.

Last week, the BSE benchmark fell 180.74 points or 0.27 per cent, and the Nifty declined 35.95 points or 0.18 per cent.

"The market will take cues from some major domestic and global macroeconomic data such as S&P global manufacturing and services PMI data of different countries, OPEC meeting, US factory orders, crude oil inventories, US initial jobless claims, RBI monetary policy review and auto sales number," said Arvinder Singh Nanda, Senior Vice President, Master Capital Services Ltd.

Published on October 1, 2023 05:28

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