Inflation, House session to drive bourses

 Inflation data, corporate results and the progress of the Monsoon Session of Parliament, as investors await policy initiatives, will dictate the stock market trend this week.

Inflation data on Tuesday will be key for the market in a shortened trading week because of the Independence Day holiday on Wednesday, August 15, experts said.
Besides, they added, investors are awaiting some policy action from Finance Minister P Chidambaram.

“Markets are eagerly awaiting follow-up action from the Finance Minister,” said Kotak Securities Head (PCG Research) Dipen Shah.

Another analyst, Geojit BNP Paribas Head (Research) Alex Matthews said, “Market is expected to remain in a range-bound manner this week. No major upside or downside is expected. Markets keenly look forward to some major reform announcement from the FM.”

Investors will closely watch the progress of the Monsoon Session, marketmen noted.
“There is a belief that some of the reforms will take place in the ongoing Monsoon Session of Parliament and the FM will do a lot better to bring back investors,” said CNI Research Chairman and Managing Director Kishor Ostwal.

Investors were enthused by Chidambaram’s comments last week to unveil a broad roadmap to regain investor confidence, and indicating that the government will work with the RBI to moderate inflation.

Experts also said that sustained buying by foreign funds is a big positive factor for the market.

Foreign institutional investors (FIIs) have been gross buyers of Indian equities worth Rs 17,544 crore, while they sold equities worth Rs 12,750 crore - a net inflow of Rs 4,794 crore so far this month, as per the Sebi data.

Marketmen said, however, that corporate earnings to be announced this week by some heavyweights will play a major role in equity movements.

Tata Steel and Coal India will declare Q1 earnings on Monday, while Hindalco and Reliance Infrastructure will do so on Tuesday.