Indian Markets Outlook for the week – 13.Jun.2016 to 17.Jun.2016
The key
domestic economic data, outcome of the US Federal Open Market Committee meet, and
result of the MSCI index review will drive equity markets in the coming week. While
industrial growth data for April is due, inflation data for May based on both the
Consumer Price Index and Wholesale Price Index will be announced on Monday and
Tuesday, respectively.
Any negative
development will trigger selling, but market participants do not see the 8000-point
mark being broken on Nifty 50. The growth in India's industrial production is likely to
rise to 1.0% in April from 0.1% a month ago, on the back of an improvement
in core sectors.
The IIP data
will not have a major impact but there might be a knee-jerk reaction if it is below
expectations. Market participants are expecting the CPI inflation to be in the range of
5.3-5.5% this time. After the Reserve Bank of India, in its monetary policy, cited upside
risks to inflation, the to be released data is crucial as it may decide the future
course of action to be taken by the central bank on key interest rates.
In April,
consumer price inflation had risen to a three-month high of 5.39%, primarily due to a
rise in food prices. On the global front, investors are uncertain about the
policy action of
the US Federal Reserve in the backdrop of Chair Janet Yellen's recent comments and
the country's jobs report data for May. The market
capitalisation of A-shares is the second highest after US stocks. Inclusion of
these shares
will see foreign funds shifting money from emerging markets to these shares.
