After the long Diwali weekend, markets enter the first week of November with big political and economic events lined up. While the most impactful will be the too-close-to-call US presidential elections keeping the world on edge, the central bank of the world's largest economy will also concurrently decide on monetary policy.
On the domestic front, campaigning for the Maharashtra and Jharkhand assembly elections will gather pace as the nomination process draws to a close.
The street will look at quarterly earnings coming from four Tata Group companies as well as State Bank of India, NHPC Ltd. and Mahindra & Mahindra Ltd.
The high-profile initial public offering of Swiggy Ltd., along with Sagility India Ltd. and ACME Solar Holdings Ltd., will also keep the primary markets busy.
Before we get into the line-up, let's recap!
Markets Last Week
The NSE Nifty 50 and BSE Sensex rebounded from two–day decline in an annual special trading session for the occasion of Samvat 2081. The Nifty 50 ended 0.39% or 94.20 points higher at 24,299.55, and the Sensex ended 0.42% or 335.06 points higher at 79,724.12.
On a weekly basis, the indices snapped a four–week decline. In the week ended Nov. 1, the Nifty ended 0.5% higher and the Sensex gained 0.4%.
The Nifty PSU Bank and Nifty Media rose the most and Nifty IT was top loser.
Foreign institutional investors pulled out over Rs 14,000 crore last week, while domestic institutional investors chipped in Rs 9,800 crore.
Motilal Oswal Financial Services anticipates that the market will continue its range-bound movement, accompanied by heightened volatility as we enter a week filled with significant events. According to Siddhartha Khemka, head of research at wealth management, investors will be closely watching the ongoing earnings season, with several major index constituents preparing to release their quarterly results next week.
In the short-term, markets will be volatile and can see 4-5% correction, said Aditya Agarwal, head of derivatives and technical analysis at Sanctum Wealth. "We prefer large-cap stocks over mid and small-cap and expect heavyweight to outperform over next 12 months."
Domestic Factors: Big Earnings, PMI Data
The second quarter earnings season will enter its fourth week. The big ones lined up are Tata Steel Ltd, Tata Motors Ltd, Trent Ltd, Titan Co, IRCTC Ltd, NHPC Ltd, State Bank of India, Mahindra & Mahindra, Mazagon Dock Shipbuilders Ltd, SJVN Ltd, Dr Reddy's Laboratories Ltd, Life Insurance Corp, Lupin Ltd, among others.
Other than earnings, any announcements regarding new acquisition, corporate actions and guidance will also weigh on the markets.
On the macro side, the HSBC Purchasing Managers' Index (PMI) data for manufacturing, composite and services will be released on Nov. 6. It will provide a window to gauge activity in these segments of the Indian economy.
Global Cues: US Election, Fed and BOE Meetings, China Trade Data
The US presidential election will be held on Nov. 5, Tuesday, and the contest couldn't be more tighter between Vice President Kamala Harris and Republican challenger Donald Trump. Opinion polls indicate a very slim margin advantage to Trump in key swing states like Pennsylvania. However, nothing can be known for sure before the election is called the next day or so.
Global markets have priced in 'Trump Trades' in likelihood of the former President's return to the White House. He has pledged to cut taxes as well as government spending, raise tarriff walls, deregulate industry and advance the 'America First' pledge of economic nationalism — all seen as good for equities and the dollar.
Besides politics, the attention will be on the Federal Reserve meeting from Nov. 6-7 where policymakers decide whether the US economy and inflation are cooling enough to warrant another rate cut. The markets are expecting a 25 basis point cut.
Across the Atlantic, the Bank of England will also make its own rate decision with a similar expectation of a 25-bps cut.
China's trade report for October, set to be released on Nov. 7, is expected to reveal sluggish export growth and a decline in imports compared to the previous year, according to Bloomberg. Although the stimulus package announced in late September is anticipated to support the economy, its effects are unlikely to be reflected in the October trade figures just yet.
Primary Market Action
Swiggy IPO
Online food and grocery delivery platform Swiggy is set to launch its IPO on Nov. 6. The offer consists of a fresh issue of shares worth Rs 4,499 and an offer-for-sale component of 17.5 crore shares. The company has set the price band in the range of Rs 371 to Rs 390 apiece.
Sagility India IPO
Healthcare solutions provider Sagility India Ltd. will launch its IPO on Nov. 5. The company aims to raise Rs 2,106.59 crore from investors via an offer for sale of more than 70.22 crore shares. Sagility India's IPO price band is Rs 28–30 apiece.
Acme Solar Holdings IPO
Bidding for the IPO of Acme Solar Holdings Ltd., a renewable energy firm, is set to open for subscription on Nov. 6. The Acme Solar IPO will consist of a fresh issue of 8.29 crore shares, worth Rs 2,395 crore, and an OFS of 1.75 crore shares. The company has set the issue's price band at Rs 275–289.
Besides, Afcons Infrastructure Ltd shares will list on stock exchanges on Nov. 4.
Corporate Actions Ahead
Next week, Hindustan Unilever Ltd., RailTel Corp, REC Ltd and Zee Entertainment Enterprises Ltd, along with several other companies, are expected to be in the spotlight as they approach their ex/record dates for dividend declarations, bonus issues, and stock splits.
The ex/record date for interim and special dividends of Hindustan Unilever is Nov. 6. Coal India Ltd will consider its eligible shareholder for interim dividend on Nov. 5. Motisons Jewellers Ltd has set Nov. 8 as ex/record date for stock split from Rs 10 to Re 1.
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