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The local stock market is likely to trade in a narrow range next week, as investors will wait and see how the Jan-Mar earnings of other companies turn out after the Infosys shocker yesterday. Investors also will watch India's headline inflation data based on the Wholesale Price Index to be released Monday by the commerce and industry ministry. The WPI inflation rate in March is seen falling to 6.4% from 6.84% a month ago. The fall in March consumer price index-based inflation has raised hopes of further Reserve Bank of India easing, but investors will wait for the WPI inflation data that will also be an indicator to the RBI policy action on May 3.
Overall bias in investor sentiment is negative and we see the National Stock Exchange's 50-share Nifty slipping below 5500 again next week. We expect selling pressure to continue towards 5400. Nifty is not expected to sustain at higher levels. Volatile movements are expected due to results from heavyweights like Reliance Industries and TCS. Yesterday, Nifty ended at 5528.55, down 65.45 points or 1.2% from Thursday, after touching an intraday low of 5494.90 points. Indices ended down yesterday led by Infosys stocks that touched a four-month low on the company's lower-than-expected revenue growth guidance for 2013-14 (Apr-Mar).
The stock, which ended down 21.3% at 2,296.65 rupees, witnessed the biggest fall in a single day for the first time since Apr 2003. In Apr 2003, stocks of Infosys had plunged over 25% on disappointing Jan-Mar earnings. Some market participants expect the stock to see some recovery as they believe the fall may be overdone. After Infosys, investors will now shift focus to other technology majors HCL Technologies and Tata Consultancy Services that will report Jan-Mar earnings on Wednesday. Traders will also watch Reliance Industries' Jan-Mar earnings on Tuesday. A spike in refining margins along with improvement in petrochemical margins is likely to lift the oil major's Jan-Mar net profit by 30% from a year ago to 55.10 bln rupees.
The local stock market is likely to trade in a narrow range next week, as investors will wait and see how the Jan-Mar earnings of other companies turn out after the Infosys shocker yesterday. Investors also will watch India's headline inflation data based on the Wholesale Price Index to be released Monday by the commerce and industry ministry. The WPI inflation rate in March is seen falling to 6.4% from 6.84% a month ago. The fall in March consumer price index-based inflation has raised hopes of further Reserve Bank of India easing, but investors will wait for the WPI inflation data that will also be an indicator to the RBI policy action on May 3.
Overall bias in investor sentiment is negative and we see the National Stock Exchange's 50-share Nifty slipping below 5500 again next week. We expect selling pressure to continue towards 5400. Nifty is not expected to sustain at higher levels. Volatile movements are expected due to results from heavyweights like Reliance Industries and TCS. Yesterday, Nifty ended at 5528.55, down 65.45 points or 1.2% from Thursday, after touching an intraday low of 5494.90 points. Indices ended down yesterday led by Infosys stocks that touched a four-month low on the company's lower-than-expected revenue growth guidance for 2013-14 (Apr-Mar).
The stock, which ended down 21.3% at 2,296.65 rupees, witnessed the biggest fall in a single day for the first time since Apr 2003. In Apr 2003, stocks of Infosys had plunged over 25% on disappointing Jan-Mar earnings. Some market participants expect the stock to see some recovery as they believe the fall may be overdone. After Infosys, investors will now shift focus to other technology majors HCL Technologies and Tata Consultancy Services that will report Jan-Mar earnings on Wednesday. Traders will also watch Reliance Industries' Jan-Mar earnings on Tuesday. A spike in refining margins along with improvement in petrochemical margins is likely to lift the oil major's Jan-Mar net profit by 30% from a year ago to 55.10 bln rupees.
