Movement in benchmark stock indices is expected to depend on the Reserve Bank of India's
monetary policy, news flow ahead of Jan-Mar corporate earnings and global developments.
Last week Wednesday, there was talk in the market that the central bank would further ease its monetary policy in its meeting on next week Tuesday. The RBI has already cut its benchmark lending rate by 50 basis points this year.
Though corporate earnings are not expected to be released next week, the market is likely to react to news flow ahead of Jan-Mar results season. Earnings in Jan-Mar may be at par or slightly better than the previous quarter. However, a recovery would only take place in the September quarter.
On the international front, details from the US Federal Open Market Committee's monetary policy meeting will be released on Wednesday. As we have a long weekend ahead, participants should keep a close watch on global cues as they may influence the early trades on Monday.
Traders should uphold stock-specific trading approach and prefer counters from private banking, automobile, infrastructure and Pharmaceutical space for fresh buying. On the other hand, further rebound in PSU banking, energy and metal and realty space may attract selling pressure so plan your positions accordingly.
Information technology stocks are expected to continue their decline next week after HCL
Technologies stated that appreciation in the dollar would negatively impact their Jan-Mar revenue and earnings before interest and tax margin.
