Earnings, crude oil, rupee to drive stock market this week

Mumbai, May 6: Key corporate earnings and factors such as movement of crude oil and rupee are likely to drive the domestic stock market this week, say experts. “Some important risk indicators are creeping up, like crude at four-year high, increase in bond yield and depreciation in the rupee. Result season will get pace in the coming weeks with major heavyweights unveiling their results,” said Vinod Nair, Head of Research, Geojit Financial Services. Outflow of foreign funds due to rich valuation is a concern to the market. Additionally, investors may start to factor the likely result of Karnataka state election based on pre-poll survey. Any hiccups to the central ruling party may cast clouds over the general election in 2019,” he added.
Among major earnings this week are from ICICI Bank, Jindal Steel & Power, Canara Bank, Union Bank of India and Dena Bank. “Volatility is likely to remain this week too. For medium to long term, focus would also remain on state elections in H2 CY18 amidst earnings recovery, fiscal deficit, interest rate movement as well as demand revival ahead of general elections scheduled in May, 2019,” said Teena Virmani, Vice President – Research at Kotak Securities.
Macroeconomic data announcements — industrial production for March and April inflation rate — post market hours on Friday may also influence sentiment. Trading sentiment in the domestic equity market on Monday may also be influenced by the non-farm pay roll data for the US released on Friday.
“The market is still in a corrective mode. Results will not make any material impact on the stocks and markets but the outcome of Karnataka elections will be a crucial event to watch out for before making a move,” said Jimeet Modi, Founder and CEO, SAMCO Securities. Over the last week, the Sensex lost 54.32 points, or 0.16 per cent, while the Nifty dropped 74.05 points, or 0.69 per cent.
Meanwhile, four of the top-10 most valued Indian companies together added Rs 39,603.27 crore in market valuation last week, with HDFC Bank emerging as the biggest gainer.
Tata Consultancy Services (TCS), HDFC Bank, HDFC and Kotak Mahindra Bank were the gainers, while Reliance Industries Ltd (RIL), ITC, HUL, Maruti Suzuki India, Infosys and ONGC suffered losses in their market capitalisation (m-cap) for the week ended Friday. The losses made by these companies (Rs 36,287.82 crore) was less than the total gains of the four firms.
From the top-10 companies list, HDFC Bank’s valuation soared Rs 17,242.88 crore to Rs 5,16,239.81 crore.
The m-cap of HDFC zoomed Rs 9,178.84 crore to Rs 3,20,531.22 crore and that of Kotak Mahindra Bank surged Rs 8,194.83 crore to Rs 2,34,705.71 crore.
TCS’ valuation jumped Rs 4,986.72 crore to Rs 6,66,334.80 crore.
On the other hand, RIL’s m-cap slumped Rs 25,844.31 crore to Rs 6,04,340.77 crore and that of Maruti declined Rs 2,987.58 crore to Rs 2,62,176.79 crore.
Infosys’ valuation dropped Rs 2,675.55 crore to Rs 2,56,176.27 crore and that of ITC dipped Rs 2,135.76 crore to Rs 3,38,669.18 crore.
The market cap of Hindustan Unilever Ltd (HUL) went down by Rs 2,067.12 crore to Rs 3,17,103.47 crore and that of ONGC fell by Rs 577.5 crore to Rs 2,31,383.23 crore.
In the ranking of top-10 firms, TCS held the numero-uno position, followed by RIL, HDFC Bank, ITC, HDFC, HUL, Maruti, Infosys, Kotak Mahindra Bank and ONGC.