Factors that could Influence Dalal Street This Week: Banking and IT Sector Results, US Industrial Production, Sensex, and Nifty

Last week, the Indian stock market experienced a bullish trend, with key indices reaching all-time highs. This positive sentiment was driven by hopes that the US Federal Reserve would pause rate hikes. In the week ahead, investors will be closely watching the first-quarter earnings reports from major players in the Indian banking and IT sectors, including HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Infosys, Mphasis, and LTIMindtree. Additionally, significant economic data such as Indian Foreign Exchange Reserves and US Manufacturing and Industrial Production data will be released.

The upcoming week will see the announcement of Q1 earnings from prominent Indian banking and finance institutions like HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IndusInd Bank, and L&T Finance Holdings. Several PSU banks, including Central Bank of India, South Indian Bank, Union Bank of India, and Bank of Maharashtra, will also disclose their results. In the IT sector, major companies such as Infosys, Mphasis, Persistent Systems, Mastek, LTIMindtree, Tata Elxsi, Coforge, and L&T and Technology Services will release their Q1 earnings. Other important companies reporting their results include Havells India, Hindustan Unilever, Reliance Industrial Infrastructure, Crisil, Tata Communications, Ashok Leyland, Hindustan Zinc, JSW Steel, and UltraTech Cement.

In terms of economic events, traders will be monitoring the release of the Foreign Exchange Reserves data on July 21. In the previous week, India's foreign exchange reserves increased to 596.1 billion from $595.05 billion.

Furthermore, several market highlights and news are worth mentioning. Indian start-ups experienced the lowest funding in four years during the first half of 2023, with Software as a Service (SaaS) emerging as the top category. The Utkarsh SFB IPO witnessed a subscription of 24.5 times on the third day of bidding, with the issue closing that day. An IT stock marked as a multibagger turned ex-dividend, surpassing a market capitalization of Rs 2,400 crore. The ongoing Amazon Prime Day Sale offered attractive deals on popular smartphones. Additionally, the Indian government brought the Goods and Services Tax Network (GSTN) under the Prevention of Money Laundering Act (PMLA), allowing data sharing with the Enforcement Directorate (ED) and Financial Intelligence Unit (FIU). Delta Corp shares experienced a significant decline over two days, indicating potential further losses according to technical charts. Brokerages shared their expectations for JSW Energy's Q1 performance. Lastly, while the Sensex reached an all-time high, some large-cap stocks struggled over the past year, leading to considerations about their investment potential.

Outside of the market, the Monsoon Session of Parliament is scheduled to commence on July 20, 2023, and will be held in the new parliament building for the first time. Additionally, Union Finance Minister Nirmala Sitharaman and Reserve Bank of India (RBI) Governor Dr. Shaktikanta Das will jointly chair a meeting of the G20 Finance Ministers and Central Bank Governors (FMCBG) in Gandhinagar, with 66 delegations attending.

From a global perspective, investors will be paying attention to several economic data releases from the United States, including the NY Empire State Manufacturing Index on July 17, Industrial Production, Manufacturing Production, and NAHB Housing Market Index on July 18, API Crude Oil Stock Change, and 20-Year Bond Auction on July 19, Initial Jobless Claims and Existing Home Sales on July 20, and Baker Hughes Total Rig Count on July 21.

Overall, the Indian stock market started the previous week with some weakness due to anticipated soft earnings in the IT sector and negative cues from US markets. Concerns regarding domestic food inflation and muted Kharif sowing led investors to exercise caution. However, controlled inflation in the US provided optimism, resulting in strong buying in Indian IT stocks, despite muted Q1 earnings. As a result, the US dollar and bond yields decreased, and the broader Indian market traded positively, reaching all-time high levels. The Nifty Bank sector had a slower start to the earnings season, but investors are eagerly awaiting more earnings reports in the coming week to determine their trading strategies.