Global trends, RBI's interest rate decision key factors for markets this week

New Delhi: Trading sentiment in the equity market this week will be guided by global trends, foreign fund movement, macroeconomic data announcements and RBI's interest rate decision, analysts said.

The monthly auto sales data announcement would also be tracked by investors this week.

"Looking ahead, markets are likely to react to the disappointing GDP growth of 5.4 pc on Monday. The upcoming RBI policy will be crucial, with both the interest rate decision and commentary being key focus areas.

"On the global front, geopolitical tensions, particularly the Russia-Ukraine situation, remains a concern. Important macroeconomic data such as manufacturing PMI from India, the US, and China, along with US jobs data and Fed Chair Jerome Powell’s speech, will also influence market sentiment," Santosh Meena, Head of Research, Swastika Investmart Ltd, said.

India's economic growth slowed to near two-year low of 5.4 per cent in the July-September quarter of this fiscal due to poor performance of manufacturing and mining sectors as well as weak consumption, but the country continued to remain the fastest-growing large economy, data showed on Friday.

The Indian equity market ended the last week on a positive note after experiencing significant volatility.

"The outlook for the market will be guided by the major domestic and global economic data such as India's manufacturing PMI, services PMI, interest rate decision, US S&P global composite PMI, manufacturing PMI, services PMI, non-farm payrolls and initial jobless claims," Palka Arora Chopra, Director, Master Capital Services Ltd, said.

Last week, BSE benchmark Sensex jumped 685.68 points or 0.86 per cent and NSE Nifty climbed 223.85 points or 0.93 per cent.

"Participants will first react to the GDP data released post-market on Friday. The primary focus will be on the RBI monetary policy review. Additionally, high-frequency indicators such as auto sales, along with manufacturing and services PMI data, are expected to provide further market direction. Foreign inflows will also remain in focus as a major driver of sentiment," Ajit Mishra – SVP, Research, Religare Broking Ltd, said.

Movement of global oil benchmark Brent crude and rupee-dollar trend would also dictate market trends, analysts said.