Macroeconomic data, TCS Q2 earnings likely to drive markets this week

Trading sentiment in the equity market will be guided by macroeconomic data announcements, global trends and quarterly earnings from IT major TCS this week, analysts said.

Stock markets would also be tracking trading activity of foreign investors who remained net sellers of Indian equities in September.

Foreign portfolio investors (FPIs) remained net sellers of Indian equities in September, withdrawing Rs 23,885 crore (around USD 2.7 billion) and taking year-to-date outflow to Rs 1.58 trillion (USD 17.6 billion).

"This week will be pivotal as the Q2 FY26 earnings season gets underway, with IT bellwether TCS scheduled to announce results on October 9. On the macroeconomic front, the release of HSBC services and composite PMI, along with banking sector data on loan and deposit growth, will be closely monitored.

"Primary market activity is also set to remain strong, with large IPOs from Tata Capital and LG Electronics lined up," Ajit Mishra SVP, Research, Religare Broking Ltd, said.

Globally, key US macroeconomic updates including the FOMC (Federal Open Market Committee) minutes, jobless claims, and consumer sentiment data will be in focus, especially against the backdrop of the ongoing government shutdown that has already delayed some economic releases, he added.

Meanwhile, movement of rupee-against the US dollar would also be tracked by investors in the backdrop of the local currency's fall to a record low level.

"With macro cues stabilizing, market attention will shift to Q2 earnings and management commentary that could steer sector sentiment. The IT sector will be in the spotlight as TCS kicks off the earnings calendar for the quarter ended September 2025 a period clouded by layoffs, a steep USD 100,000 H-1B visa fee hike, and the proposed 25 per cent outsourcing tax by the Trump administration.

"Against this backdrop, markets will be keenly watching management commentary on the impact of tariffs and visa costs, hiring outlook, deal wins, discretionary tech spending, and progress on AI initiatives. The tone of these updates could set the course for sector sentiment in the weeks ahead," Ponmudi R, CEO Enrich Money, an online trading and wealth tech firm, said.

Last week, the BSE benchmark climbed 780.71 points or 0.97 per cent, and the Nifty went up by 239.55 points or 0.97 per cent.

"Indian equities closed the holiday-shortened week with a positive bias after recent corrections as investors' confidence was reinforced with the recent RBI's growth stance," Vinod Nair, Head of Research, Geojit Investments Limited, said.