Geopolitical developments, crude prices likely to move markets this week

Trading activity in the stock market this week will depend on the developments surrounding the Strait of Hormuz, the US-Iran standoff and crude oil, analysts said.

With the quarterly earnings season now over, investors would also monitor the trading activity of foreign investors, experts added.

"Developments surrounding the Strait of Hormuz and the trajectory of Brent crude will remain critical market drivers in the near term. With the earnings season behind us, the coming week will be relatively data-light, with investors likely to focus on global monetary policy expectations, crude oil prices and geopolitical developments," Ajit Mishra SVP, Research, Religare Broking Ltd, said.

 

Globally, the FOMC (Federal Open Market Committee) minutes will be closely watched for signals on the Federal Reserve's policy outlook. Any indication of a more hawkish stance could weigh on emerging-market flows and increase volatility in Indian equities, he added.

"Investor attention in the coming week is likely to remain firmly focused on developments surrounding the Strait of Hormuz and the broader USIran standoff. Investor focus will also turn to the release of the minutes from the Federal Reserve's July policy meeting on August 19," Ponmudi R, CEO - Enrich Money, an online trading and wealth tech firm, said.

Beyond global developments, investors will closely watch foreign institutional flows, he added.

Last week, the BSE benchmark Sensex declined 489.92 points, or 0.62 per cent, and the NSE Nifty dipped 204.65 points, or 0.83 per cent.

Indian equity markets ended lower during the week, snapping a two-week winning streak as rising crude oil prices and renewed geopolitical tensions dampened investor sentiment, Ponmudi added.

Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking, said this week investors will closely track crude oil price movements and developments in the ongoing US-Iran geopolitical tensions.

Investors will closely track crude oil, geopolitical developments, FOMC minutes, and Chinese economic data for further cues on global growth and the Fed's policy outlook, Vinod Nair, Head of Research, Geojit Investments Limited, said.