Global Trends, Domestic Macro Data To Drive Markets This Week: Analysts

Monthly auto sales and Purchasing Managers’ Index (PMI) data for manufacturing and services sectors would also influence trading in the market, they added. Benchmark BSE Sensex tumbled 1,538.64 points or 2.52 per cent last week amid concerns that the US Federal Reserve might raise interest rates further to curb inflation. Fresh foreign fund outflows also dented investor sentiments. Pressurised by weak global cues, most sectoral indices traded in sync with the benchmark and ended lower.

"The market will continue to keep an eye on the direction of global markets along with the movement of US bond yields and the dollar index in the near term because the interest rate scenario in the US will remain a dominating factor in the first half of 2023. "The market isn't currently responding to the geopolitical situation all that much, but any unexpected development — positive or negative — could cause the market to move significantly. Domestically, our Q4 GDP numbers and monthly auto sales numbers will be key macro factors this week," said Santosh Meena, Head of Research, Swastika Investmart Ltd. Trading in the market will also be guided by Brent crude oil movement and the rupee-dollar trend.

"The markets may continue to witness intermittent bearish spells as investors are likely to cut their long positions owing to multiple negative factors," Amol Athawale, Deputy Vice President - Technical Research, Kotak Securities Ltd, said. "With the beginning of the new month, participants will be eyeing important macroeconomic and high-frequency data during the week. To start with, GDP data and core sector data are scheduled on February 28. Besides, PMI manufacturing and services data will be unveiled on March 1 and March 3, respectively. 

"The auto sales numbers will also start pouring in from March 1. Apart from the domestic data, global market performance, and movement of crude and rupee will remain on participants’ radar," said Ajit Mishra, VP - Technical Research, Religare Broking Ltd. The resurgence of the cold war between the US and Russia has also brought apprehensions to the market, said Vinod Nair, Head of Research at Geojit Financial Services. "Although it should be a short-term effect, the fear of sanctions against Russia and its degree of implication on the economy, especially food and oil exports, is adding to the anxiety," Nair added.