Dalal Street week ahead: Key factors to watch - Union Budget, Q1 earnings, and US GDP

The market is expected to remain range-bound with a potential positive bias due to renewed Foreign Institutional Investors (FIIs) interest, as per market experts. Last week's cautious sentiment stemmed from the upcoming Union Budget, corporate earnings, and US GDP numbers.

Market Sentiment:

The benchmark indices, the BSE Sensex, and Nifty 50, experienced a slight decline of about one percent due to a sell-off on Friday, ending the week flat but with a positive bias. Despite early-week gains driven by IT companies' earnings and strong FMCG performance, the market faced caution ahead of the Budget and disruptions led by Microsoft.

Corporate Earnings:

Key earnings reports from Reliance Industries, Wipro, HDFC Bank, Kotak Mahindra Bank, and JSW Steel, announced post-market hours, will influence market movements. Nearly 300 companies, including major players like Bajaj Finance, Hindustan Unilever, Axis Bank, and Larsen & Toubro, are set to release their quarterly results next week.

Domestic Economic Data:

Attention will be on the HSBC Manufacturing and Services PMI flash numbers for July, along with bank loan and deposit growth, and foreign exchange reserves data.

Union Budget 2024:

The Union Budget, to be presented on July 23, is a significant event, expected to be pro-industry with a focus on fiscal deficit balance, capital expenditure, social spending, job creation, Make in India initiative, green energy, and rural-urban boost. The budget's impact on long-term capital gains tax will also be closely watched.

US GDP and Global Data:

Advance estimates of US GDP growth for Q2 2024 will be critical. Other important US data include core PCE prices, durable goods orders, and retail sales for June. Global PMI flash numbers from the US, Europe, and Japan will also be monitored.

FII Activity:

FIIs have been consistent buyers in Indian equities, with significant investments in technology, telecom, oil & gas, auto, healthcare, and capital goods sectors. Domestic institutional investors, however, engaged in profit booking.

IPO Activity:

The SME segment will see eight IPOs next week, including SAR Televenture, RNFI Services, VL Infraprojects, VVIP Infratech, Manglam Infra and Engineering, and Chetana Education. The mainboard will witness Sansar closing its public issue on July 23.

Technical View:

Nifty 50 faces critical support at 24,500, with major support at 24,000. Resistance levels are set at 24,850 and 25,000. The options data indicate immediate resistance at 24,700 and support at 23,500.

Volatility:

Market volatility is expected to remain elevated ahead of the Budget, with India VIX rising 8% for the second consecutive week.

Corporate Actions:

Key corporate actions scheduled for the coming week will also be of interest.

Conclusion:

Investors are advised to stay cautious and seek expert advice before making investment decisions amid these critical events and market conditions.

Disclaimer:

The views expressed by investment experts on Moneycontrol.com are personal opinions. Moneycontrol.com recommends consulting certified experts before making investment decisions.