Markets likely to continue on upward journey this week
With the renewed confidence of foreign funds in the Indian stock market, decline in crude oil prices and food inflation showing signs of softening, the stock market is likely to continue its gaining spree this week amid the onset of corporate earnings.business Updated: Jul 03, 2011 15:31 IST
With the renewed confidence of foreign funds in the Indian stock market, decline in crude oil prices and food inflation showing signs of softening, the stock market is likely to continue its gaining spree this week amid the onset of corporate earnings.
"The market is likely to continue its northbound journey amid an array of positive triggers, like crude oil prices are slowing down, corporate earning season is going to start and it is expected that blue-chip companies will give their best.
"Also, the government has become active lately by announcing a hike in fuel prices and the CCEA giving its approval to Cairn Energy for selling its Indian unit to Vedanta Resources," CNI Research CMD Kishore P Ostwal said.
The BSE benchmark Sensex surged by 522.12 points, or 2.86%, to end the week at 18,762.80, led by aggressive buying by foreign institutional investors (FIIs) and easing of Greece's debt worries.
"The Q1, FY12, corporate earnings is likely to drive the market sentiment this week. FII flows will be crucial as part of the current rally was driven by overseas investors. Inflation and monetary policy will remain in focus in July, especially after the recent fuel price hike," IIFL - India Private Clients Head of Research Amar Ambani said.
Analysts said the market trend in July is expected to be influenced by the progress of monsoon showers, as well as the announcements of corporate results for Q1, FY'12.
The government's decision to raise prices of diesel, kerosene and cooking gas has brightened the prospects of Indian equities, they added.
Marketmen said that moderating inflation and the government's assertion that it would achieve the targeted 8.75% growth in the current fiscal will further boost the market sentiment.
FIIs bought shares worth about Rs 5,770 crore during the past week. Realty, metal, capital goods and banking counters were the major gainers of the week.
HDFC's results on July 8 will kick-off the Q1 earnings season of FY'12, followed by Infosys on July 12.