Markets week ahead: From Fed rate decision to key Q4 earnings, factors that may drive Sensex, Nifty

In the coming week, which marks the start of the new month, market participants would be watching out for S&P Global Manufacturing PMI, scheduled to be released on Monday (May 1). The S&P Global India Manufacturing PMI rose to a 3-month high of 56.4 in March 2023 from 55.3 in February, topping market forecasts of 55.0. Stock markets would be shut for trade on May 1 on account of Maharashtra Day. Also on May 3, investors will be eyeing S&P Global Services PMI data. Further, auto and cement companies would be in focus for the coming week as these companies will report their monthly sales figures.

 Major results this week

In the ongoing result season, traders will be eyeing the earnings of prominent companies, including Adani Green Energy, Gravita India, New Delhi Television (NDTV), Ambuja Cements, Adani Total Gas, Cigniti Technologies, Tata Steel, UCO Bank, Godrej Properties, Havells India, MRF, Sula Vineyards, Tata Chemicals, Titan Company, Adani Enterprises, Blue Star, CEAT, Dabur India, HDFC, Hero Motocorp, Tata Power Company, TVS Motor Company, Bharat Forge, Britannia, Federal Bank, Marico, and Bank of India, etc.

Market watcher Vinod Nair, Head of Research at Geojit Financial Services, said: "The Indian market saw a reversal in trend compared to the previous week, with strong earnings reported by heavyweights, especially banks, boosting sentiment. Meanwhile, oil prices declined due to concerns over the global economic slowdown, which outweighed the prospect of tighter supplies by OPEC+. As India is a large importer of crude, the correction had a positive impact on the market.”

"However, global markets continued to spill volatility into the home market as the Fed is expected to hike its policy rates by another 25 bps. The release of a weaker US GDP number and high inflation will trigger further cautiousness in the global market in the coming days, though stronger-than-expected earnings reported by Meta propelled strong buying in IT stocks. In the domestic market, the release of PMI numbers and quarterly earnings will sway investor sentiment in the upcoming sessions, along with the Fed policy announcement," he said. 

US market data

On the global front, investors would be eyeing a few economic data from the world’s largest economy, the US, starting from S&P Global Manufacturing PMI Final on May 1, followed by Redbook, Factory Orders on May 2, S&P Global Composite PMI Final, ISM Services PMI, S&P Global Services PMI Final, Fed interest rate decision on May 3, Balance of Trade, Initial Jobless Claims on May 4, Non-Farm Payrolls, Unemployment Rate on May 5.

Foreign Investments

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: "FPIs appear to have changed their investment strategy in India in recent days. While they were sellers in the initial three months of this year, they have turned buyers in April and aggressive buyers in the last few days of April. FPIs have bought equity worth Rs 9752 crores till 29th April (NSDL data)."

"An important macro factor that has tilted the FPI approach is the appreciation of the rupee. Rupee which had touched a low of 82.94 to the dollar in late February this year has now appreciated to 81.75 to the dollar. India’s Current Account Deficit is declining and if this trend continues the rupee may appreciate further. FPIs are likely to bring more inflows into India in this context. FPIs have been buying in financial services and auto and auto components," he added. 

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