Indian equities markets will be led by the U.S. Federal Reserve’s call for interest rates and domestic macroeconomic data this week, analysts said.
Market participants are also strongly targeting US Fed’s plans to address the volatility in bond yields. The yield of rising U.S. bonds has drawn a safe bet and caused a correction in global equities to most tech stocks in recent weeks.
Indian rations followed global affairs over the past week. The rise in U.S. bond yields kept volatility high, moving between gains and losses.
While a fall in the U.S. unemployment rate and the signing of the bill helped boost the market in between, bond yields rose above market sentiment, analysts said.
During the holiday shortening last week, the 30-share BSE index gained 386.76 points or 0.78 percent. Markets were closed on Thursday due to Mahashivratri.
“Markets will initially deal with macroeconomic data viz IIP and CPI inflation, which came in after Friday market hours. Next, WPI inflation is scheduled for March 15. In addition, updates on the Covid-19 situation and related news remain on the participants’ radars.
“On the global front, the market is closely monitoring the US Fed meeting for their stance on interest rates and plans to address the volatility in bond yields,” said Ajit Mishra, VP Research, Religare Broking.
In a double case for the economy, industrial production growth once again entered the negative territory by contracting with 1.6 percent in January, while retail inflation rose to a three-year high. months of 5.03 percent in February on more expensive food items.
“The market will be strongly focused on the upcoming Femeeting to be held on March 16 & 17,” said policy Vinod Nair, Head of Research at Geojit Financial Services.
The market would also be dependent on the investment movement of foreign portfolio investors, the movement of the rupee against the U.S. dollar and Brent crude prices.
Extending the streak he earned for the third day in a row, the Indian rupee advanced by 12 more passes to close at 72.79 against the US dollar on Friday.
Rusmik Oza, Executive Vice President, Head of Basic Research at Kotak Securities, said, “All eyes on Fed action will be ongoing.”
“In our view, hardening bond yields and rising oil prices are expected to put pressure on investor sentiment and could keep markets from remaining volatile in the short to medium term,” Binod Modi said. , Key Strategy at Reliance Securities.
Concerns about bond yields have fueled late selling pressures in global equities.