InvestorQ : What are the major trading and investing cues and events to look forward for the coming week
indhumathi Sayani made post

What are the major trading and investing cues and events to look forward for the coming week

Riya Dwivedi answered.
2 years ago

The coming week will be critical from the results point of view and from the flow of key macro data coming in. not to forget there will also be the next round of elections that will happen this week, which will be the fifth round, with just two more to go. Let us look at some key cues for the coming week.

· Oil prices will be an important data point to watch. The price of Brent crude fell from $75.60/bbl to below 70 levels before closing the week at $70.85/bbl. How the price of oil behaves will be critical as it will impact the local inflation in India and also its import bill and the trade deficit picture.

· The fifth phase of the Lok Sabha elections will kick off on Monday with voting for 54 seats across India. Polling will happen across Bihar, Jharkhand, Rajasthan, Uttar Pradesh and parts of West Bengal. Some of the prestigious and high profile seats like Amethi, Rae Bareli, Lucknow, Hazaribagh, Ranchi and Saran will happen on 06th May.

· One can expect some continued reaction on the downside on FMCG stocks and IT stocks. FMCG stocks saw sentiments souring due to weak sales numbers and rural off take presented by HUL, Godrej Consumer Products and Britannia. IT stocks have taken it on the chin after Cognizant downsized its guidance and the dollar showed signs of weakening.

· FPIs have been sellers in the first two days. While it is a short period of time, we have seen FPIs normally selling out ahead of election outcome and then taking a fresh view after the results are out. This week will underline if the FPIs are planning anything on those lines.

· The sharp downgrade of Yes Bank will be in the news and will not only have an impact on Yes Bank prices but also on other private banks. Yes Bank had reported a sharp rise in provisions due to its exposure to the Jet Airways group and the IL&FS group. Markets are preparing for more negative surprises on this stock.

· Auto stocks will also be in focus after most of the auto companies announced very weak sales numbers for the month of April. There was pressure on auto numbers due to weak demand, high fuel prices and tight financing conditions. Auto, along with FMCG and IT will be the key deciding factors in the week.

· With the PMI manufacturing out, the focus will shift to the PMI Services. If that is also weak, then the markets may react negatively to the cues on growth numbers. Manufacturing has already been under pressure for quite some time now.

· The IIP numbers for March will be announced on 10th May and that will be one of the key inputs for markets. Core sector for March has shown some positive traction and that gives hope for IIP as core sector accounts for nearly 43% of the IIP basket. CPI inflation number is expected on 13th May.