[ad_1]
Indian stock markets will be guided by the US Federal Reserve’s call on interest rates and national macroeconomic data this week, analysts said.
Market participants will also be focusing on the US Fed’s plans to tackle the volatility of bond yields. Rising U.S. bond yields have drawn betting on safe-haven stocks and caused a correction in global stocks, mostly tech stocks, in recent weeks.
Indian stocks have tracked global indices throughout the past week. Rising US bond yields kept volatility high, swinging between gains and losses.
Although the fall in the unemployment rate in the United States and the signing of the stimulus bill helped the market in between, the continued rise in bond yields has outpaced market sentiment, analysts said.
During the shortened holiday period last week, the 30-stock BSE benchmark gained 386.76 points or 0.78 percent. The markets were closed on Thursday due to Mahashivratri.
“The markets will react first to macroeconomic data, namely the IIP and CPI inflation, which occurred Friday after market hours. Then, WPI inflation is scheduled for March 15th. .
“On the global front, the market will be watching the US Fed meeting closely for its stance on interest rates and plans to tackle bond yield volatility,” said Ajit Mishra, vice president of research at Religare Broking.
In a double whammy to the economy, industrial production growth slipped back into negative territory contracting 1.6% in January, while retail inflation climbed to a three-month high of 5. 03% in February for more expensive food products.
“The market will be strongly focused on the next Femeeting scheduled for March 16-17,” said Vinod Policy Nair, research manager at Geojit Financial Services.
The market would also depend on the investment trend of foreign portfolio investors, the movement of the rupee against the US dollar and the prices of Brent.
Extending its winning streak for the third day in a row, the Indian rupee advanced another 12 paise to close at 72.79 against the US dollar on Friday.
Rusmik Oza, executive vice president and head of basic research at Kotak Securities, said: “All eyes will be on the Fed’s action going forward.”
“We believe that the tightening of bond yields and the surge in oil prices should weigh on investor sentiment and could maintain market volatility in the short to medium term,” said Binod Modi, head of strategy at Reliance Securities.
Concerns about bond yields belatedly triggered selling pressure on global equities.
Source link
