Q1 earnings, crude oil, FII flows likely to drive Indian stock market next week

Mumbai, July 5 (IANS) The Indian stock market is expected to take cues from the start of the June quarter earnings season, global geopolitical developments, crude oil price movement, foreign investor activity and currency trends in the coming week. After extending gains for a third consecutive session on Friday, benchmark indices will also be closely watched for their response to domestic macroeconomic indicators and global market sentiment.

Indian benchmark indices ended higher for the third straight session on Friday, supported by gains in information technology and pharmaceutical stocks despite mixed global cues.

The Sensex climbed 262 points, or 0.34 per cent, to settle at 77,763.91, while the Nifty advanced 95 points, or 0.39 per cent, to close at 24,270.85.

The market’s positive momentum was underpinned by encouraging domestic macroeconomic data, including robust GST collections, improving industrial activity and continued expansion in both the manufacturing and services sectors. Investors will now shift their attention to several key factors that could influence market direction in the week ahead.

The June quarter earnings season will be the primary focus, with Tata Consultancy Services (TCS) scheduled to announce its Q1 FY27 results on July 9.

Global geopolitical developments will remain another important monitor. Investors will keep a close watch on developments involving the United States and Iran after recent tensions in the region.

Market participants will also assess any impact from Iran’s scheduled funeral ceremonies for former Supreme Leader Ali Khamenei and any fresh diplomatic or geopolitical developments that could influence global risk sentiment.

Crude oil prices will continue to be a key variable for Indian markets. Oil prices remained largely stable during the week as traders remained optimistic that diplomatic efforts between the US and Iran could help ease tensions. Any sharp movement in crude prices could affect inflation expectations, corporate profitability and India’s import bill.

Foreign investor activity will also remain in focus after Foreign Institutional Investors (FIIs) continued to sell Indian equities during the week, with net outflows of Rs 40 billion, according to provisional exchange data.

Currency movement will be another factor for investors to watch. The Indian rupee strengthened by 17 paise to close at 95.18 against the US dollar on Friday, aided by a softer dollar index and firm domestic equity markets.

–IANS

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