Mumbai : Lack of a positive trigger, coupled with expectations of subdued quarterly earning results, might lead to further consolidation in the Indian markets in the coming week, analysts said.
“The markets are looking forward to the fourth quarter earning results. The expectations are that the results might not be that exciting,” Devendra Nevgi, chief executive of ZyFin Advisors, told IANS.
According to Nevgi, global cues would be watched by the markets for insights on further developments. The prices of gold and oil will also be keenly observed.
The passage of several key bills on coal, mines and minerals and the appropriation bill for 2015-16, which were keenly observed by the markets, will have an impact on the trade in the coming week.
Parliament has gone into a month-long recess and will resume on April 20.
“The markets are awaiting developments on important bills like the Land Acquisition Bill. Moreover, markets are also awaiting the fourth quarter results, which are expected to be subdued,” Dipen Shah, head of private client group research at Kotak Securities, told IANS.
On the other hand, Nevgi said that the markets will watch out for the ground level implementation of the various bills passed and any announcements on post-session reforms.
Also, the imminent threat of a rate hike is behind the markets as the US Fed took a dovish stand and said this might happen in the later part of the year.
This was a major relief for markets such as India, where the downside of the Fed meet was being seen as an immediate rate hike announcement or one in the near future.
With higher interest rates in the US, the foreign portfolio investors (FPIs) are expected to be led away from emerging markets such as India.
“Since there is lack of clarity in the domestic markets cues will be taken from the global markets in the near term which may lead to volatile moves on some days. Our advice in short term to such investors is to take money home by booking profits,” said Gaurang Shah, vice president, Geojit BNP Paribas.
“Our view is that we could inch higher and consolidate for the next few weeks before we get a meaningful breakout on the higher side,” Shah added.
“On the domestic data front the retail inflation could inch higher as the unseasonal rains have impacted the crop to a great extent and the prices of food and food-related commodities have seen a surge in recent times. This could keep the CPI elevated,” Shah said.
Other triggers for the markets in the coming week will be concerns on the marginal increase in retail inflation for February which belied expectations of a rate cut next month.
The Reserve Bank of India is scheduled to announce its first bi-monthly policy review for 2015 on April 7.
Meanwhile, the Indian equities markets lost 242 points or 0.84 percent during the weekly trade ended March 20.
The benchmark 30-scrip Sensitive Index (Sensex) of the S&P Bombay Stock Exchange (BSE) fell 242.22 points or 0.84 percent during the weekly trade session ended March 20.
The Sensex ended the March 20 trade at 28,261.08 points. It had closed at 28,503.30 points for the previous weekly trade ended March 13, when it plunged 945.65 points or 3.21 percent to its worst weekly fall in 2015.