The outcome of the Reserve Bank of India’s Monetary Policy Committee (MPC) deliberations – the first scheduled review since its surprise rate hike on May 4 – will take center stage on Dalal Street this week. With the earnings season now behind us, attention should also shift to global signals and institutional flows.
The week that was
Last week, benchmark Indian stocks rose around 1.5% each, although the banking index slipped into the red after back-to-back weekly gains.
According to Vinod Nair, Head of Research at Geojit Financial Services, positive domestic signals in the form of strong TPS collections, reassuring PMI data and easing FII outflows have supported the market, although high rates in the crude oil brought the rise under control.
“The continued rise in crude oil prices due to the EU’s decision to partially ban Russian oil has hampered global markets. However, lack of confidence in the domestic market led to a sell-off towards the last hours of the week, driven by concerns over central bank policy… If central banks decide to tighten policy hard, the market mood may swing to the downside,” he said.
The road ahead
A breakout of key resistance territory is imminent, continuing its short-term uptrend, although there is no substantial evidence that the corrective phase is over, according to head of equity research Yesha Shah at Samco Securities.
“We recommend traders maintain a slightly bullish to cautious outlook and employ a stock-specific buy-dip strategy,” Shah said, seeing immediate resistance at 17,400.
Here are the main factors and events likely to influence Dalal Street during the week starting June 6:
|June 6||UK car sales data||China services PMI data|
|June 7||Commercial data||Eurozone construction PMI data, UK services PMI data, Germany factory orders data||Japanese Household Spending Data|
|June 8||Crude Oil Inventories||Eurozone GDP and employment data, UK construction PMI data, Germany manufacturing data||Japan GDP data|
|June 9||Jobs data||ECB rate decision|
|June 10||Inflation data||Inflation data in China|
Data on factory output – gauged by the industrial production index – is due on June 10.
Institutional money flows will remain on investors’ radar as foreign investors remain net sellers of Indian stocks while domestic investors continue to be net buyers.
Last week, Foreign Institutional Investors (FIIs) sold Indian shares worth Rs
6,654 crore and Domestic Institutional Investors (DII) made net purchases of Rs 6,845 crore, according to preliminary exchange data.
|Company||Date of departure||Objective||Registration Date|
|Gallantt Ispat||June 6||Merger||June 7|
|Apcotex Industries||June 6||Final dividend Rs 3||–|
|Aurobindo Pharmacy||June 6||Interim dividend Rs 4.5||June 7|
|Faze three||June 6||Interim dividend Re 0.5||June 7|
|INEOS Styrolution India||June 6||Interim dividend Rs 105||June 7|
|MM forgings||June 6||Interim dividend Rs 6||June 7|
|NINtec Systems||June 6||Bonus number 1:2||June 7|
|Rallies||June 6||Final dividend Rs 3||–|
|Varun drinks||June 6||Bonus number 1:2||June 7|
|Satyam Silk Mills||June 6||good problem||June 6|
|AAR trading company||June 7||Merger||June 7|
|General insurance company||June 7||Interim dividend Rs 2.25||June 8|
|Global Pearl Industries||June 7||Interim dividend Rs 5||June 8|
|GG Engineering||June 8||Stock split from Rs 2 to Re 1||June 9|
|Jagsonpal Pharma||June 8||AGE||–|
|Kansai Nerolac||June 8||Final dividend Re 1||–|
|Asian Paintings||June 9||Final dividend Rs 15.5||June 10|
|Asian granita||June 9||Final dividend Re 0.7||June 10|
|AU Small Financial Bank||June 9||Bonus number 1:1||June 10|
|Automation Craftsman||June 9||Dividend Rs 3.75||–|
|electronic engineering||June 9||Final dividend Re 1||June 10|
|electronic engineering||June 9||Special dividend Re 0.4||June 10|
|AMC HDFC||June 9||Dividend Rs 42||–|
|India Engine Parts & Accessories||June 9||Interim dividend Rs 13||June 10|
|Mukand Engineers||June 9||Merger||June 10|
|PFCs||June 9||Final dividend Re 1.25||June 10|
|QuessCorp||June 9||Interim dividend Rs 4||June 10|
|Silver Touch Technology||June 9||Interim dividend Re 0.5||June 10|
|SMC Global Securities||June 9||Final dividend Re 1.2||–|
|Tata Consumer||June 9||Final dividend Rs 6.05||–|
|Transcorp International||June 9||Dividend Re 0.1||–|
|Volta||June 9||Final dividend Rs 5.5||–|
|Welspun Corp.||June 9||Dividend Rs 5||June 10|
|CEAT||June 10||Final dividend Rs 3||June 13|
|LKP financing||June 10||Final dividend Rs 3||–|
|LKP Titles||June 10||Final dividend Re 0.3||–|
|Issuance of Sadhna||June 10||Stock split from Rs 10 to Re 1||June 13|
|Sagarsoft (India)||June 10||Dividend Rs 3||–|
|Shree Digvijay Cement||June 10||Final dividend Rs 2||June 13|
|Tata Communications||June 10||Final dividend Rs 20.7||–|