The upcoming week is expected to be busy for Dalal Street investors as a number of companies are scheduled to release their quarterly earnings.
This is anticipated to result in a highly stock-centric market activity. Additionally, foreign investors have reduced their buying pace.
While the overall market trajectory remains positive, there is likely to be a period of consolidation following the recent strong rally.
“In the coming days, domestic earnings will play a crucial role in market trends, while global cues will also be significant,” said Vinod Nair, head of research, Geojit Financial Services.
Q1 Earnings
Maruti Suzuki India, Power Grid Corporation of India, Adani Transmission, Adani Green Energy, Titan Company, Bharti Airtel, Adani Enterprises, Sun Pharmaceutical Industries, InterGlobe Aviation, Ambuja Cements, Gail (India), Bosch, UPL, HPCL, Dabur India, Eicher Motors, Zomato, State Bank of India, Mahindra & Mahindra, Britannia Industries, BHEL, and Delhivery are among the major companies scheduled to release their earnings in the upcoming week.
So far, companies have reported numbers that are largely in line with expectations, although there have been some disappointments in the IT sector. “With the markets trading at valuations above long term averages, the focus will be on the delivery of earnings,” said Shibani Sircar Kurian, senior EVP and Head – Equity Research, Kotak Mahindra Asset Management Co.
Macroeconomic Data
The government will release July’s GST collections on August 1. The manufacturing PMI data for major countries, including India, will be released by S&P.
The Services PMI data will also be released in the upcoming week.
Automobile Sales
The wholesale sales data for July will be released by automobile companies on August 1. Dalal Street investors will closely monitor this data to gauge the sustainability of sales momentum in the coming months.
Global Markets
With the US Federal Reserve’s recent policy action concluded, there are no major triggers on the global front. However, investors will still look to global markets for early trade cues.
FII Flows
After witnessing strong flows in the early part of July, foreign institutional inflows significantly slowed down last week. Foreign portfolio investors net invested only Rs 468 crore in domestic markets during the week ending July 28, compared to Rs 7,804 crore in the preceding week.
Therefore, their strategy will be crucial in sustaining market momentum and pushing indices higher.
IPO Watch
The primary market has been active with a number of public issues, and this trend is expected to continue in the upcoming week.
SBFC Finance’s public issue will be open for subscription on August 3, while Concord Biotech’s will open on August 4.
Among SME firms, Oriana Power and Vinsys IT Services will open their public issues for subscription on August 1, while Yudiz Solutions will open on August 4.
Corporate Action
A number of companies’ stocks will trade ex-dividend in the upcoming week. Some notable ones include Larsen & Toubro, which will trade ex-date for a Rs 24 dividend payout on August 2.
Hawkins Cookers will trade ex-date for a Rs 100 per share dividend on August 2, while United Breweries will trade ex-date for a Rs 7.50 per share dividend.
AGMs
Several companies have scheduled their annual general meetings in the upcoming week. Titan, Lupin, Delta Corp, DLF, Mahindra & Mahindra, and Union Bank of India, among others, will conduct their AGMs next week.
Technical Indicators
Following a positive chart pattern with higher tops and bottoms on the daily charts, the benchmark Nifty 50 appears to have formed a new lower high, indicating an ongoing downward correction in the market, according to technical analysts.
This also suggests the possibility of selling pressure emerging during any upside bounce from here, said Nagaraj Shetti, technical analyst, HDFC Securities.
From the current level, unless the Nifty breaks below 19550, no significant downward movement is expected and the market may not favor aggressive short positions, said Rupak De, senior technical analyst, LKP Securities.
On the other hand, below 19550, the index may fall towards 19300. Resistance on the upper end is positioned at 19700.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own and do not represent the views of Economic Times)