InvestorQ : What are the major trading and investment cues for the week commencing on 19 August and what to watch out for?
Arti Chavan made post

What are the major trading and investment cues for the week commencing on 19 August and what to watch out for?

Answer
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1 year ago


The week starting August 19 will be interesting in the sense that it will be a full trading week after a truncated week when only 3 days of trading happened. Apart from results, there will be the outcome of the meeting between the FM and the PM, which will be eagerly awaited. Here are the major trading and investment cues for the week.

· The outcome of the meeting between the prime minister and finance minister will be the big news item on Monday. While the meeting is supposed to have been productive, the actual announcement is expected this week. Some of the expectations are FPI tax relief, change in LTCG tax formula, scrapping of buyback tax, big spending etc.

· The RBI minutes are released exactly 2 weeks after the actual policy announcement and that is expected on 21 August. The market will be keen to understand the logic of the 35 bps rate cut and what it forebodes for future rate hikes.

· The rupee has been giving a lot of worries to equity traders and since the beginning of August it has lost nearly 3.5%. The markets will be closely watching the movement of the Chinese Yuan and the impact on the INR to see if it really weakens beyond Rs.71/$.

· At the global level, fresh trade talks have been virtually on hold with diverse tweets coming out from Donald Trump. This has again raised the fears of a global slowdown and markets will be keen to see some positive progress on the trade talks.

· Oil prices could also hold the key. Brent crude corrected below the $60/bbl mark and has stayed there. However, this week the OPEC is expected to announce further cuts in supply and that could be a key factor driving prices of oil in the coming week.

· US yield curve inverted during the week and therefore the markets will be focused on the US 10 year yields, which dipped to as low as 1.55% last week. An inverted yield is seen as a sign of coming recession and that is not a positive sign for markets.

· Q1 has not been too great as of now and more than half of the Nifty companies have given results lower than expectations. Index heavy weights like IT, FMCG, autos and PSU banks have reported weak numbers and that is likely to impact markets this week.

· While most of the key results are already announced for the June quarter, some of the key companies expected to announce results this week are CG Power, P&G and Gillette India. There could be stock specific movements to watch out for in these counters.

· The US FOMC minutes are also expected during the week and that could give an indication about the future trajectory of interest rates. The markets will be hoping for a dovish language to keep the global markets buoyant.

The most important factor will be the much anticipated stimulus package from the government, which the markets are building big expectations over.