The upcoming week in the equity market is expected to be shaped by a range of significant factors, including quarterly earnings from prominent IT companies such as TCS and Wipro, as well as domestic inflation and IIP data. Analysts believe that these key indicators, along with global influences and foreign investor activity, will play a pivotal role in determining the direction of the equities market.
Quarterly Earnings and Economic Indicators
Market participants are eagerly anticipating the first quarter earnings reports from HCL Tech, TCS, and Wipro, which are scheduled to be released this week. Additionally, investor sentiment will be influenced by the forthcoming inflation and IIP (Index of Industrial Production) data, set to be announced on July 12. Moreover, the movement of crude oil prices and macroeconomic indicators from the United States will be closely monitored.
Santosh Meena, head of research, Swastika Investmart Ltd., says, “As we approach the first quarter earnings season, HCL Tech, TCS and Wipro are set to report their earnings this week. Will respond and IIP data is due for release on July 12. US macroeconomic indicators and crude oil price movements will also be closely monitored.
Inflation and Market-Specific Announcements
Apart from the aforementioned factors, investors will keep a close eye on the Wholesale Price Index (WPI) inflation data for June, which is scheduled to be announced on Friday. The results of Federal Bank, Bandhan Bank, and JSW Energy for the June quarter will also be disclosed during the week. These stock-specific developments are expected to generate increased market activity as the Q1 FY24 earnings season kicks off.
Emphasizing on the importance of the technology sector, Siddharth Khemka, Head of Retail Research, Motilal Oswal Financial Services Ltd. said, “Technology sector is likely to remain in focus after TCS and HCL Tech announce their results on Wednesday, followed by Thursday.” Results will be declared by Wipro.”
Key Factors Shaping the Market
Looking ahead, several key factors will drive the market in the coming days. Arvinder Singh Nanda, Senior Vice President at Master Capital Services Ltd, identifies the following factors: “Global and domestic cues, upcoming quarterly season, India’s inflation data, IIP number, FII, and DII activities will be the key factors that will drive the market in the coming days.”
Recent Market Performance
In the past week, the 30-share BSE benchmark saw a significant gain of 561.89 points or 0.86 per cent. On 7 July, the BSE Sensex reached an all-time intra-day peak of 65,898.98. The market capitalization of BSE-listed firms also hit a record high of ₹301.70 lakh crore on Thursday, reflecting positive sentiment in domestic equities.
However, Santosh Meena points out, “The Indian equity market experienced yet another week of record highs, mainly driven by aggressive buying by foreign institutional investors (FIIs). There was profit booking in the session. US bond yields rise.” As a result, the BSE benchmark saw a fall of 505.19 points or 0.77 per cent on Friday after a significant rally.
Amol Athawale, Vice President – Technical Research at Kotak Securities Ltd, explains the recent market decline, stating, “The market was overheated after the spectacular rally in recent sessions, and profit-taking was due for some time. With fresh concerns over interest rate hikes by the US Fed resurfacing, investors shunned equities, triggering a massive fall on the last day of the trading week.”
