US Manufacturing PMI, Fed Meet, UK GDP: The Week Ahead

The US Fed meeting and the quarterly earnings will be major market movers in the coming week, with no significant domestic events lined up.

The upcoming week will witness market giants like Tata Steel Ltd., Mahindra & Mahindra Ltd., Tata Motors Ltd., Sun Pharmaceuticals Ltd., ITC Ltd., and Titan Co. posting their first-quarter earnings, setting the tone for market sentiment.

"We are of the view that the short-term market texture is bullish, but due to temporary overbought conditions, we could see rangebound activity in the near future," according to Amol Athwale, vice president, technical research, Kotak Securities Ltd.

According to him, 24,675-24,600/80,900-80,600 would act as a key support zone. On the higher side, 25,000/81,600 could be the immediate hurdle for the bulls, he said.

Primary market activity will be relatively quiet, with only one initial public offering.

Among sectors, pharma and healthcare indices outperformed—pharma index rallied 6% and healthcare index was up by 5.90%, whereas realty and Bank Nifty indices shed over 1.5%, according to Athwale.

India's benchmark equity indices snapped five consecutive days of fall to close at their highest levels on Friday. On a weekly basis the Nifty, recorded its best streak of gains since eight weeks ended Jan. 22, 2018.

Both the indices closed at their highest levels on Friday, with Nifty closing 428.75 points, or 1.76% higher at 24,834.85 and Sensex ending the day 1,292.92 points, or 1.62% up at 81,332.72

On a weekly basis, Nifty added 1.24% and Sensex closed 0.90% higher.

Most sectoral indices ended higher this week with Nifty Pharma leading and Nifty Bank coming out as the top loser.

Shares of Infosys Ltd., Bharti Airtel Ltd., ITC Ltd., Reliance Industries Ltd., and ICICI Bank Ltd. led the gains, while those of Oil & Natural Gas Corp., HDFC Bank Ltd., Tata Consumer Ltd., Nestle India Ltd., and Axis Bank Ltd. fell significantly.

Nifty formed a significant bullish candle on both the daily and weekly scales, indicating underlying strength, said Hrishikesh Yedve, AVP technical and derivatives research at Asit C. Mehta Investment Interrmediates Ltd. If the index sustains above 24,860, it may attempt to test the psychological level of 25,000, he said.

The Federal fiscal deficit for June is scheduled to be released July 31. RBI Monetary and Credit Information Review, and consolidated year-on-year infrastructure output for June will also be released during the week.

Nikkei S&P Global Manufacturing Purchasing Managers' Index is expected to be released on Aug. 1. The previous Manufacturing PMI was at 58.5.

The Reserve Bank of India is expected to release the data for bank loan growth, deposit growth and foreign exchange reserves on Friday. India's forex reserves were at $670.8 billion for the week ended July 19.

The Euro zone will release the estimate of gross domestic product for second quarter on July 30, and core CPI data for the year on July 31.

The US government's Fed Rate Interest Decision as well as the FOMC Press Conference are scheduled to be held on Wednesday.

The manufacturing PMI for the US, Euro Zone and England will be released on Thursday, along with the Bank Of England's Interest Rate Decision. The US government is scheduled to release the unemployment rate data on Friday.

Tata Steel Ltd., Mahindra & Mahindra Ltd., Maruti Suzuki India Ltd., Tata Motors Ltd., Sun Pharmaceutical Industries Ltd., ITC Ltd., and Titan Ltd. will post their first-quarter earnings, setting the tone for market sentiment.

Oher companies announcing their results in the coming week include Colgate Palmolive (India) Ltd., Dabur India Ltd., Godrej Properties Ltd., Bharat Electronics Ltd., Adani Total Gas Ltd., Ambuja Cements Ltd. and Indian Oil Corp.

The primary market will see subdued action this week with eight SME initial public offerings and seven listing. There will be one new IPO this week on the mainboard.

Akums Drugs and Pharmaceuticals Ltd. is looking to raise Rs 680 crore via fresh issue of 1 crore shares and an offer for sale of 1.73 crore shares. The issue price for the IPO is set in the Rs 646-679 price band. The IPO will open on Tuesday and list on Aug. 6.

Hero Motocorp Ltd., Divi's Laboratories Ltd., Cipla Ltd., Coforge Ltd., Maruti Suzuki India Ltd., Automotive Axles Ltd., Birla Corporation Ltd., Ultratech Cement Ltd. and Bata India Ltd. will have record dates for their dividends in the coming week.

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