Analysts said corporate earnings and global trends would set the tone for the equity markets in the coming week for a holiday-shortened week where volatility could also come amid the expiry of scheduled monthly derivatives.
BSE and NSE will hold a one-hour special Muhurta trading session on Monday, marking the beginning of Samvat 2079 – the Hindu calendar year that begins with Diwali.
Markets will remain closed on Wednesday on the occasion of ‘Diwali Balipratipada’.
Santosh Meena, Head of Research, Swastika Investmart Ltd said, “We are heading towards a short festive week where the bulls have reason to celebrate Diwali on a high note as the US market witnessed a sharp jump in Friday’s trading session. “
Meena said that the market will keep an eye on the direction of global markets, dollar index, US bond yield and crude oil prices.
“On the domestic front, there may be some volatility from the end of October, while Q2 earnings will lead to stock-specific movement,” Meena said.
Scheduled monthly derivatives expiration will keep volatility high. In addition, earnings and performance of global markets will remain on the radar, said Ajit Mishra, VP – Research, Religare Broking Ltd.
Investors will also keep an eye on the rupee-dollar trend, foreign institutional investors (FIIs) trading activity and Brent crude oil prices.
“On the earnings front, participants will first react to the results of major indexes such as Reliance, ICICI Bank and Kotak Mahindra Bank. In addition, other leading names like Tata Chemicals, Dr Reddy’s, Maruti, Vedanta and Tata Power also reported their numbers during the period. Will announce this week,” Mishra said.
Billionaire Mukesh Ambani’s Reliance Industries Ltd on Friday reported a flat growth in net profit for the September quarter following a fall in earnings in the core oil business following a newly introduced windfall profit tax and lower refining margins.
The oil-to-retail-to-telecom group’s consolidated net profit stood at Rs 13,656 crore in July-September, almost unchanged from net earnings of Rs 13,680 crore in the same period last year, according to a company statement.
Country’s second largest private sector lender ICICI Bank on Saturday reported a 31.43 per cent jump in its September quarter net profit at Rs 8,006.99 crore.
Its counterpart Kotak Mahindra Bank reported a growth of nearly 27 per cent in net profit to Rs 2,581 crore for the quarter ended September 2022.
Vinod Nair, Head of Research, Geojit Financial Services said, “Since there are no major triggers for this week, market direction will be based on global sentiment and earnings season.”
Shrikant Chauhan, Head of Equity Research (Retail) at Kotak Securities said that in the near term, domestic markets will continue to track global growth and one can expect stock-specific action amid the ongoing Q2 FY23 result season.
Last week, the Sensex had gained 1,387.18 points, or 2.39 per cent.
“Buying in select IT, energy and FMCG companies maintained a positive trend for most of the week, coupled with buoyancy on the banking front,” Mishra said.
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