The Indian markets shall primarily be influenced by a number of components together with macroeconomic information, Indian and US inflation information, and international cues amongst others within the coming week, in accordance to analysts.
This week, traders will probably be searching for the key macroeconomic information beginning with the Consumer Price Index (CPI) for February to be out on March 13. Also, the Wholesale Price Index (WPI) information for February will probably be launched a day later, on March 14. On the identical day, the market members will probably be eyeing the Balance of Payment (Exports and Imports) information. The Society of Indian Automobile Manufacturers (SIAM) will come out with the full passenger car gross sales information on the identical day. The international trade reserves information goes to be launched on March 17.
Meanwhile, the second section of the Budget session will start on Monday (March 13) and will proceed until April 6. During the session, the main focus will probably be on the dialogue of the calls for for grants for varied ministries aside from the federal government’s legislative agenda.
Vinod Nair, Head of Research at Geojit Financial Services, mentioned: “The global market has fallen back into the grip of uncertainty following the Fed chief’s comment that signalled the possibility of a prolonged and faster rate hike, contradicting a dovish comment made by another Fed official last week. The market now anticipates a 50 bps rate hike, which has pushed the dollar index to a three-month high. Selling intensified towards the end of the week following further negative cues from the US market and as the market awaited the release of US unemployment and non-farm payroll data, which will have a significant impact on the upcoming Fed meeting.”
Key factors that will keep traders busy next week:
CPI Inflation
The monthly retail inflation for February will be released on March 13 and WPI inflation on March 14. The market will closely watch both data points as it is expected to decide the next course of action by the Reserve Bank of India in its next policy meeting scheduled in the first week of April.
“We expect CPI inflation to have moderated in February, after the material upside surprise in January. We forecast February CPI inflation at 6.3 percent YoY and expect the RBI’s preferred core inflation measure to have edged down to 6 percent YoY in February, partly due to a high base,” Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics, Barclays said.
Adani Group Stocks
Adani Group stocks may remain in focus as a Financial Times reported that Gautam Adani, who owns diversified Adani group, is planning to sell stake worth around $450 million in Ambuja Cements. The group holds 63 percent stake in Ambuja Cements which was acquired for $10.5 billion last year.
Further, both the leading bourses NSE and BSE on March 10 said two Adani Group firms — Adani Transmission and Adani Total Gas — will be put under the second stage of the long term additional surveillance measures framework, effective from March 13 as per the circular available on the exchanges.
Adani Enterprises, Adani Power and Adani Wilmar are already under the short-term additional surveillance measure (ASM) framework Stage – I since March 9, while NDTV and Adani Green Energy are already under the long term ASM framework Stage – II.
Nifty – Technical Outlook
Amol Athawale, Deputy Vice President of Technical Research at Kotak Securities, said technically, the Nifty has formed a strong bearish candle on weekly charts and it is comfortably trading below the 20 and 50-day SMA. “For the positional traders, 17,550 would act as a medium-term resistance zone and below the same, the index could slip till 17150.
On the flip side, a minor pullback rally is possible, if the index trades above 17425 and could move up to 17480-17500. Meanwhile, Bank Nifty also breached the important support level of 41,000 or 20-day SMA (Simple Moving Average) which is broadly negative. Below the same, the Bank Nifty could retest the level of 40,000-39,800,” he concluded.
Silicon Valley Bank Crisis
According to inventory market specialists, falling banking shares dragged different key benchmark indices like Nifty and Sensex on Friday session. But, Silicon Valley Bank information of chapter received’t final lengthy as it’s fully sentimental information for Dalal Street. From basic perspective, Indian banks are fully insulated from Silicon Valley Bank and margins of Indian banks have improved in latest quarterly outcomes. They suggested cut price hunters to purchase high quality banking shares on this fall as these banking shares would bounce again strongly throughout pattern reversal.
Speaking on the Silicon Valley Bank disaster and its affect on Indian inventory market, Avinash Gorakshkar, Head of Research at Profitmart Securities mentioned, “From basic perspective, Indian banks don’t have any join with SVB disaster neither the American financial institution has any penetration in Indian company sector. So, the inventory market crash on Friday was solely sentimental as bias was already adverse on Dalal Street.”
US Inflation
Globally investors will keep an eye on US inflation numbers scheduled on March 14, which is more important for the Federal Reserve before taking decision on interest rates in next policy meeting on March 22.
Fed Chair Jerome Powell in his testimony last week continued with his statement saying higher and potential aggressive policy tightening is needed to control and bring inflation to 2 percent target, but that will still be data dependent.
ECB Interest Rate Decision
Next week, we will also have an interest rate decision to be taken by the European Central Bank on March 16 and February inflation of European Union on March 17.
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