While there are no fresh allegations against the Adani Group, the shares of which recouped losses made in the aftermath of the Hindenburg crisis, the new report may impact investor sentiments.
The coming week will be a truncated one as the Indian market will be shut for the Independence Day holiday on August 15.
Here are 6 factors for investors to track this week:
1) Hindenburg vs Sebi saga
About 18 months after its first report against the Adani Group, the Hindenburg issue has resurfaced once again with the short-seller now training the guns on Sebi chief Madhabi Puri Buch and her husband.
“The current SEBI Chairperson and her husband, Dhaval Buch, had hidden stakes in the exact same obscure offshore Bermuda and Mauritius funds, found in the same complex nested structure, used by Vinod Adani,” Hindenburg said in a fresh report.
While the Buch family has vehemently denied all allegations, the issue is attracting political attention with Congress leader Jairam Ramesh demanding a JPC probe on the Adani issue.
2) FII flow
FIIs withdrew $1.3 billion from the Indian stock market in the week but the buying of around $2.2 billion worth of equities by domestic institutional investors last week limited the downside on Dalal Street last week.
“FII holding in India is already at a 10-year low. India is a unique large country with government stability, double-digit economic growth, double-digit corporate earnings growth, and double-digit corporate ROE. In my view, FIIs canβt remain out for a long period of time,” Alok Agarwal, Head – Quant & Fund Manager, Alchemy Capital Management, said.
3) Q1 results
We are now in the last leg of the June quarter results season. During the week, Vodafone Idea, Hindalco Industries, Hero Moto, Nykaa, HAL and Apollo Hospitals would release their Q1 numbers.
βA lack of fresh triggers and subdued earnings will be a deterrent for higher valuation, investors are advised to shift their focus from growth stocks to value stocks,β said Vinod Nair, Head of Research, Geojit Financial Services.
So far, 46 companies in Nifty50 index which have published their results have reported PAT growth of 6.12% YoY, which is marginally better than 5.78% expectation, however the overall it seems moderating compared to previous quarters.
4) Global markets
Global markets recovered most of their losses in later part of the week. On a weekly basis, the S&P 500 was down 0.05%, the Dow was down 0.6% and the Nasdaq was down 0.2%.
While the carry trade issue appears to have been eased for now, a gradual increase in interest rates by the BoJ could have some impact in the near future, analysts say.
5) Macro data
On the economic data front, US inflation and retail sales for Julβ24 as well as weekly jobless claims data will be in focus. India will also release its inflation numbers for July along with industrial and manufacturing production data for June.
6) Technical factors
Nifty formed a Hammer candle on the weekly charts, indicating a potential further upside move in the coming week after a contraction of a thousand points from its life highs.
βThe next resistance level is at 24,400, and if this level breaks, we could move towards 25,000. On the support side, 24,000 will act as a major support area which is also near 55 days EMA, and if the index moves below this, we could see a fall towards 23,500,β said Arvinder Singh Nanda of Master Capital Services.
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