The US Fed interest rate decision, domestic inflation data and global trends would be key driving factors in dictating movement in the market this week, as the Lok Sabha elections outcome and the RBI policy decision are behind us, analysts said.

The past week was a roller-coaster ride for investors as markets swung sharply in both directions before closing with strong gains.

Also Read: FPIs Take Out Rs 14,800 Cr From Equities In June On Poll Results, Attractive Chinese Stock Valuations

In an eventful week, the BSE benchmark jumped 2,732.05 points or 3.69 per cent and the Nifty zoomed 759.45 points or 3.37 per cent.

The 30-share BSE Sensex jumped 1,720.8 points or 2.29 per cent to hit a new record peak of 76,795.31 in day trade on Friday. The benchmark ended at a record high of 76,693.36, up 1,618.85 points, or 2.16 per cent.

“Now the Lok Sabha elections and the RBI policy decision are settled, attention now turns to global factors. Key areas to watch include the US Fed interest rate decision, the rupee’s movement against the dollar, crude oil prices and commodity prices.

“Additionally, investments by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) will remain under close observation,” said Pravesh Gour, Senior Technical Analyst, Swastika Investmart Ltd.

Globally, significant events are scheduled for June 12, 2024, including announcement of the US core and consumer price inflation figures, alongside the US Federal Reserve’s interest rate decision and Federal Open Market Committee (FOMC) economic projections, he added.

Additionally, on June 14, 2024, the Bank of Japan will announce its interest rate decision, Gour said.

“Domestically, India’s economic calendar is also marked with key releases. On June 12, 2024, both India’s industrial production data and inflation data will be unveiled,” Gour added.

Trading activity of foreign investors would also be crucial in dictating terms in the market.

“The outlook for the market will be guided by major domestic and global economic data. India WPI inflation, China CPI inflation, UK GDP data, US CPI data, and the US Fed interest decision will guide the market this week,” Arvinder Singh Nanda, Senior Vice President, Master Capital Services Ltd, said.

After the huge volatility witnessed in the market in response to the election results (both exit polls and actual results) the market is slowly stabilising, V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said.

“We believe volatility is likely to decrease now that major events are behind us, with focus shifting to domestic macroeconomic data such as IIP, CPI, and WPI for further signals. Additionally, global cues, particularly the upcoming US Fed meeting, will be closely watched by participants,” Ajit Mishra – SVP, Research, Religare Broking Ltd, said.

Eight of Top-10 Valued Firms Add Rs 3.28 Lakh Crore in Market Cap

Eight of the 10 most valued domestic firms together added Rs 3.28 lakh crore to their market valuation last week, with blue-chips Tata Consultancy Services, Hindustan Unilever and Reliance Industries emerging as the biggest winners.

From the top-10 pack, Reliance Industries, Tata Consultancy Services (TCS), HDFC Bank, Bharti Airtel, ICICI Bank, Infosys, Hindustan Unilever (HUL) and ITC were the gainers. These companies added a total of Rs 3,28,116.58 crore to their market valuations.

FPIs Take Out Rs 14,800 Cr From Equities In June 

Foreign investors withdrew nearly Rs 14,800 crore from domestic stocks in the first week of this month, influenced by India’s Lok Sabha election results and attractive valuations of Chinese stocks.

The outflow came following a net outflow of Rs 25,586 crore in May on poll jitters and more than Rs 8,700 crore in April on concerns over a tweak in India’s tax treaty with Mauritius and a sustained rise in US bond yields.

(With PTI inputs)