Reliance Shares To Fii’s Behavior: Top 5 Triggers For Stock Market This Week

Stock market this week: After a long weekend, Indian stock markets witnessed a considerable volatility last week wherein it initially corrected post a gap down opening and NSE Nifty almost tested 16,800 levels. It recovered from that level during mid-week and surpassed 17,400 mark but it was not over yet as it gave up some of the gains on the last trading session and ended below 17,200 with a weekly loss of 1.74 per cent. On Friday, Indian stocks snapped a two-day winning streak on April 22, impacted by the hint by Fed Chair Powell about an imminent rate hike of 50 bps in June.

So, when re-opens on Monday; global cues, F&O expiration, Q4 earnings, etc. are expected to dominate stock market this week. Here we list out top 5 triggers for Indian stocks this week that traders and investors need to watch out for:

1]Reliance share price movement: The Reliance Industries Limited (R‎IL) has called off 24,700 crore retail deal with the Future Group that is going to have its impact on the Indian stock market. “Reliance Industries weighs around one-sixth of the net strength of Sensex and it is considered one of the heavy weight stocks at Dalal Street. After the RIL’s announcement to call-off its retail business deal with Future Group, Reliance shares are expected to feel the sell-off heat on Monday and some more upcoming sessions. So, it is important for investors to keep an eye on RIL share price movement when the market reopens on Monday,” said Avinash Gorakshkar, Head of Research at Profitmart Securities.

2]FII’s behaviour: Asking stock market investors to keep an eye on FII’s trade pattern; Santosh Meena, Head of Research at Swastika Investmart Ltd said, “FIIs are continuously selling in the Indian equity market and their behavior will be important amid concerns of aggressive rate hikes in the USA.” He said that foreign investors have been continuously selling at Indian indices since October 2021 (except one week in the beginning of this month). In April 2022, FIIs have sold Indian stocks worth 29,206.19 crores till date. So, it is important to keep an eye on FII’s trade behavior as status quo in their trade pattern would mean heavy selloff on highs or heavy beating in first few sessions.

“If we look at the derivative data then the put-call ratio is sitting at 0.91 level whereas FIIs’ long exposure in index future stands at 47%, both are heading towards the oversold zone,” Santosh Meena said.

3]USGDP data: The US Gross Domestic Product (GDP) data is expected on 28th April 2022. “In case of disappointing US GDP data, inflation concern will grow further leading to sell-off pressure on global equity markets including Dalal Street,” said Avinash Gorakshkar of Profitmart Securities.

4]Q4 results: “In terms of Q4 earnings, the market will react to the results of ICICI Bank on Monday while Bajaj Finance, HDFC Life, Bajaj Auto, HUL, Ambuja Cement, Axis Bank, Bajaj Finserv, Vedanta, IndusInd Bank, Maruti Suzuki, Ultratech Cement and Wipro will be other key results which are scheduled this week,” said Santosh Meena of Swastika Investmart.

5]Dollar Index: Stock market investors need to keep an eye on Dollar Index as well. The Dollar Index has emerged to record 101 levels and any further escalation in the index may lead to more FIIs selling at Dalal Street. “Historically, FIIs become net sellers at Indian indices when Dollar Index gains. As the index has emerged to record high, any further rise in Dollar Index would mean more FII’s selling pressure on Indian stocks,” said Avinash Gorakshkar.

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