This week, RBI monetary policy review will drive the stock markets. Federal Open Market Committee (FOMC) will meet on Tuesday and Wednesday. No rate change this time is expected to improve. Next Interest hike only expected until September. Globally, the US Federal Reserve meeting to decide interest rate will also be watched out by investors worldwide.

As the key companies will release their earnings this week like HDFC, Tata Motors, Axis Bank, ONGC, Tech Mahindra, Vedanta Ltd, Power Grid InterGlobe Aviation Ltd, IndiGo, Avenue Supermarts Ltd and Idea Cellular Ltd.

In accordance to the 15 economists surveyed, 12 expects RBI to raise its repo rate high, the rate at which it lends to commercial banks to 6.5 %, only 3 expects RBI to keep rates unchanged at 6.25 %.

After the sales data, Auto stocks will remain in focus this week, on 1st August. According to data released by the Society of Indian Automobile Manufacturers(SIAM), passenger vehicle sales in rose by 37054% in June,this was the fastest monthly growth in nearly 10 years mainly due to the low base of last year when customers postponed purchases expecting price cuts after GST rollout, inflating the growth rate.

According to the observation, the Q1 earnings season has started on a positive note. It means some trade tensions seems to be ease and some positive momentum are seen in domestic markets on the global front. In the near term, the momentum will also depend on the outcome of RBI meet, which may expect to rise by 25bps hike.  Investors are eagerly awaiting US GDP data which might put some influence on UD Fed policy meeting next week.

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