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Inflation risks, growth concerns, rising oil prices and FII sales weighed on market sentiment. As a result, the market recorded a fall of more than 2% during the week ended June 10. On Friday alone, the BSE Sensex fell more than 1,000 points.

During the week, the BSE Sensex lost 1,466 points, or 2.63%, to end at 54,303 and Nifty50 lost 382.5 points, or 2.3%, to 16,202.

Ajit Mishra, VP-Research, Religare Broking, said: “Markets are under severe pressure due to global inflation concerns. Indicators point to a continuation of the downtrend.”

Amid growing uncertainties, Yesha Shah, Head (Equity Research) at Samco Securities, advised investors to be extremely cautious until the market clearly finds a direction.

These 10 factors could be very important for the market next week:

Inflation: After the RBI raised the inflation forecast for FY23 by 100 basis points to 6.7%, retail price inflation (CPI) would be a key factor in the inflation figures . CPI inflation figures will be released on June 13.

Experts expect retail inflation to be around 7.1-7.3% in May, down from 7.79% the previous month, the highest since May 2014. For the central bank , the inflation data for May and June will be very important.

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FOMC meeting

A two-day meeting of the Federal Open Market Committee will take place June 14-15. The meeting will gain importance due to the higher-than-expected inflation rate of 8.6% in May, which is the highest level since December 1981.

The volatility of stocks and bonds is a clear indication that inflation is still at its peak. Therefore, the market will keep an eye on the Fed’s aggressive stance in terms of rate hikes.

Oil prices

Oil prices: Crude oil prices last week were around or above $120 a barrel, well above the $105 base set for inflation estimates on the year whole. Due to its dependence on imports for its oil needs, oil prices are very important for India.

Experts said recession fears and China’s Kovid restrictions could put pressure on oil prices, but geopolitical tensions could bolster prices.

On a weekly basis, international benchmark Brent futures rose 1.9% to $122.01 a barrel.

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trade balance

Trade Balance: The market will also be keeping tabs on upcoming trade data next week. According to preliminary data, the trade deficit would be $23.33 billion in May 2022, which will be a record. In May last year, it was at the $6.33 billion level. According to preliminary data, imports could increase by 56.14% due to petroleum and petroleum products. At the same time, exports are expected to increase by 15.46%.

FII Clearance

FIIs continue to sell off in developing markets like India due to inflation fears amid geopolitical tensions and tight stance by central banks. Experts said that for this reason too, the rise in stock markets should be limited. FIIs sold shares worth Rs 12,662 crore this week, while DIIs bought shares worth Rs 9,611 crore.

The rupee plunged to a record low of 77.87 against the dollar on Friday in the FII selloff amid geopolitical tensions and inflation fears, firming US bond yields and buoyant oil prices. The US Dollar Index is already trading above 104. Experts expect the Rupee to weaken to 78.20-78.50 per dollar in the near future.

technical view

Nifty50 forms a bearish candlestick on the daily chart as well as the weekly chart. It broke through the crucial level of 16,400 as well as 16,250 in a single session. This gives a clear indication of panic in the market.

Yesha Shah advises to avoid taking aggressive trades next week saying that the benchmark is looking to move towards the 15,900 and 16,100 support areas. If Nifty does not fall below 15,900 it will chances are he will reach level 16,800.

M&O signals

Experts said options data indicates that Nifty could trade in a wide range of 15,800-16,700 in the coming sessions. However, the 16,000-16,200 levels will remain crucial for stability.

ICICI Direct said we believe Nifty can consolidate above 16,200 going forward. However, below this level the selling pressure can be seen up to the 15,800 level.

Securities transaction

These corporate actions could be crucial for the market in the coming weeks:

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global data points

The market will be watching these global data points for the FOMC meeting next week:

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Disclaimer: The opinions expressed on moneycontrol.com are the personal opinions of the experts. The website or the management are not responsible for this. Money Control advises users to consult a certified expert before making any investment decision.

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