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Volume IconMarket Ahead, June 22: Top factors that could guide markets this week

The Indian markets are likely to start this week on a flat note with a negative bias, on the back of similar trend in global indices

ImageBS Web Team New Delhi
Markets continue to rally on RBI policy fillip; Sensex rises 164 points

After rallying nearly 3 per cent last week, the Indian markets are likely to start this week on a flat note with a negative bias, on the back of similar trend in global indices. The SGX Nifty was trading at 10,190 levels at 7:15 AM. Among Asian indices, South Korea's Kospi and Austrlia's ASX were trading 0.8 per cent lower while Japan's Nikkei was flat.

Geopolitical developments and trend in Covid-19 cases will set the tone for equity markets this week while expiry of June series derivatve contracts is expected to inject some volatility as traders will roll over their positions to next month

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Besides, trend in global markets, and foreign fund movement would also dictate sentiments, while the last leg of March quarter earnings will trigger stock-specific movements.

Eight days after recording 3 lakh Covid-19 cases, India went past the 4 lakh-mark on Sunday with the biggest single-day spike of 15,915 new infections, while the death toll rose to 13,294, according to Worldometer. Globally, over 89 lakh people have been infected so far. Some countries are witnessing a second-wave with the most notable resurgence seen in China’s capital Beijing. As such, trend in Covid-19 infections in India and globally will remain a key monitorable for market participants.

Investors will also keep a keen eye on the vaccine front. Hetero will launch remdesivir, an injectable drug from Gilead, to treat hospitalised Covid-19 patients this week.

Traders will also monitor the escalating tensions between India and China. Defence Minister Rajnath Singh yesterday told India’s top military brass to be “fully prepared” to take any unprecedented action at the Line of Actual Control. Any increase in tensions can have an immediate impact on the markets. 

On the results front, more than 600 companies are scheduld to release their quarterly earnings this week, which includes the likes of ITC, Asian Paints, GAIL India, Coal India, and IRCTC. 

On the macro front, current account data for the fourth quarter will be released on June 26. Globally, investors will be eyeing some ket macro-economic reports from the US including Manufacturing PMI, GDP growth rate, and the results of Fed stress test for big banks.

Now, some other top news.

The RBI has asked banks to carry out detailed stress tests due to the impact of Covid-19 on their books and put capital-raising plans with board approvals in place, if needed.

Sources have told Business Standard that the Union home ministry is likely to stall security clearance to a clutch of Chinese companies seeking to invest in India, in sync with the current sentiment.

The YES Bank board is meeting today to take a call to raise up to Rs 10,000 crore via a follow-on share sale to help boost its capital base.

US President Donald Trump said late on Saturday he would announce new restrictions on visas within a couple of days to block the entry of certain foreign workers. Any such step would directly impact the IT stocks back home.

And, in the end, a technical look at the Nifty.

The Nifty last closed at 10,244, above its 100-day moving average on Friday. According to analysts, all eyes will now be on 10,350, a level from which the index retreated twice last week. If the Nifty manages to breach this level, the next stop could be 10,550.

Read by: Chirinjibi Thapa

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First Published: Jun 22 2020 | 7:47 AM IST

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