Earning week or fear of loss? The wheel of the stock market will turn on the basis of these 3 big factors

Even though there was a decline in the stock market last week, next week the stock market will react on the basis of three important factors. Analysts said developments related to the US-Iran situation, crude oil prices and RBI’s interest rate decision will determine the equity market trend in the coming week. Apart from this, he said that macroeconomic data announcements, movements of foreign investors and rupee-dollar trend will act as core drivers for equities.

PMI figures

Ajit Mishra, SVP, Research, Religare Broking Ltd, said market participants will closely monitor global developments related to the US-Iran situation and movements in crude oil prices, which continue to be important for inflation expectations, currency stability and foreign inflows. The final figures of HSBC Manufacturing PMI for the month of May will be released on Monday, followed by Services PMI and Composite PMI figures on Wednesday. He said that these indicators will provide important information about demand trends, business activities and strength of growth in various sectors.

GDP figures

Mishra further said that the most important event of this week will be the announcement of RBI’s monetary policy on Friday. Apart from this, he said, investors will also keep an eye on India’s GDP growth data and foreign exchange reserves data to get more clarity about the economic momentum and stability of the external sector. Last week, the BSE benchmark Sensex fell 639.61 points, or 0.84 percent, and the NSE Nifty fell 171.55 points, or 0.72 percent.

geo political tension

Ponmudi R, CEO of online trading and wealth tech firm Enrich Money, said that geopolitical and macroeconomic developments are expected to have a deep impact on the market this week. The attention of investors will mainly focus on the ongoing talks between America and Iran, wider diplomatic developments taking place in the Middle East and fluctuations in crude oil prices. He further said that apart from geopolitics, investors will also closely monitor rupee movements, institutional investment trends, global equity market trends and key macroeconomic indicators to determine the future direction of the market.

RBI MPC

Santosh Meena, head of research at Swastika Investmart Ltd, said the main domestic event this week will be the RBI MPC meeting, which is scheduled to be announced on Friday. Amid rising inflation concerns and currency-related developments, market participants will closely monitor RBI’s stance on inflation, liquidity and interest rates. He said that apart from this, the monthly figures of automobile sales for the month of May will be released on June 1, which will provide information about the demand trend in the sector.

Looking ahead, the near-term direction for Indian equities depends on two interlinked factors: the RBI’s monetary policy decision and the release of India’s GDP data, said Vinod Nair, Head of Research, Geojit Investments Limited. At the same time, India’s PMI and IIP data will give the first important information about the industrial pace at the beginning of Q1FY27.