Pre-Stock market update
Pre-stock market update India Today: Despite dramatically increasing volatility on the other hand, the benchmark index rose a few percentage points during the extended week that concluded on May 18, indicating a drastic comeback from recent lows in the market. The mood was reinforced by stronger-than-expected results from index heavyweights, encouraging signs from around the world, and ongoing optimism about a reduction in the Fed funds rate in response to US economic data—despite ongoing doubts about when the rate drop will occur. Buying activity was also stimulated by the positive sentiment in the larger markets and the expectation of a positive outlook following the general elections.
In the upcoming abbreviated week, the market is anticipated to be consolidative with a leaning toward the upside. Market participants will be concentrating on the FOMC minutes and the Fed chair’s speech, as well as the upcoming corporate earnings report and the phases of the Lok Sabha elections, as these events are expected to support the indices for future direction, according to experts.
While the BSE Sensex closed 1,341.5 points or 1.85 percent higher at 74,006, the Nifty 50 soared 447 points or 2 percent to 22,502, while the broader markets outpaced benchmark indexes, with the Nifty Midcap 100 and Smallcap 100 indices rising 4.7 percent and 5.6 percent, respectively.
“We will be eagerly watching the US and India’s May PMI data releases next week for additional market insights. We anticipate significant volatility in the near term given the persistent concerns around the election results and quarterly profits,” said Vinod Nair, Head of Research at Geojit Financial Services.
On May 20, equity markets will be closed in observance of the general elections.
DoFollow: Lok Sabha Elections Update for regular all pre-stock market update as per the elections.
Observe the following ten crucial elements:
1) Corporate profits
Nearly 900 companies, including well-known ones like Oil and Natural Gas Corporation, Grasim Industries, Power Grid Corporation of India, Sun Pharmaceutical, ITC, Hindalco Industries, NTPC, and Divis Laboratories, will release their quarterly earnings in the seventh week of March, signaling the end of the earnings season for the March quarter.
Next week, the following companies will also release their quarterly financial results: Aurobindo Pharma, BHEL, Bharat Electronics, Bosch, Petronet LNG, InterGlobe Aviation, Ashok Leyland, Jubilant FoodWorks, One 97 Communications, FSN E-Commerce Ventures, Honasa Consumer, New India Assurance Company, India Cements, Oil India, SAIL, Gland Pharma, Glenmark Pharmaceuticals, Hindustan Copper, Manappuram Finance, Nazara Technologies, Suzlon Energy, and United Spirits.
Analysts indicated that the company profits that have been released thus far are mostly expected and do not present any significant surprises, either positive or negative.
2) Lok Sabha Elections
Additionally, the market players will monitor the voter turnout in each of the final three phases of the current general elections. Four of the seven phases of the voting, which began with the first phase on April 19, have been completed thus far. The Lok Sabha election will proceed to the following two phases next week. Voting for the fifth phase will take place on May 20 in 49 constituencies spread across six states and two union territories; voting for the sixth phase will take place on May 25 in 57 constituencies spread across seven states and two union territories.
Read more about Trade Spotlight: How to Trade Tech Mahindra, TVS Motor, MTAR Tech, Aurobindo, and Other Companies.
The Election Commission reports that 66.95 percent of voters participated in all four of the general election’s phases. On April 19, 66.14 percent of voters turned out, on April 26, 66.71 percent on April 7, 65.68 percent on May 7, and 69.16 percent on May 13 were registered in the first phase.
Read more: Stock Market Update ahead of Lok Sabha Elections
3) Domestic Economy
On May 23, the May PMI Flash figures for HSBC Manufacturing and Services will be made public. The Manufacturing PMI was 58.8 in April compared to 59.1 in March, and the Services PMI was 60.8 compared to 61.2 in the same month.
Additionally, on May 24, the foreign exchange reserves for the week ending May 17 will be made public.
4) Fed Chair Powell’s speech and the FOMC minutes
The Federal Reserve Chair Jerome Powell’s speech on May 21 and the FOMC minutes of the monetary policy meeting earlier this month on May 22 will continue to be the center of attention on the international scene. Powell stated last week in his address on May 14 that the rate of decline in inflation has been slower than anticipated, meaning that benchmark interest rates will probably stay high for a while. Powell also stated that the central bank does not anticipate raising rates in the near future. The US inflation rate for April 2024 was 3.4 percent, down from 3.5 percent the month before. This is still much higher than the Federal Reserve’s 2 percent target.
The Fed kept interest rates at 5.25–5.5 percent during the most recent FOMC meeting for the sixth time in a row. As a result, everyone will be watching the cues regarding the rate cut timeframe from the speech and minutes.
5) The World Economy
Additionally, the market players will monitor US data on jobs, new home sales, and durable goods orders in addition to flash numbers from the Manufacturing and Services PMI in the Eurozone and Japan, as well as the country’s inflation for April.
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