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Sunday, August 04, 2013

Next batch of Q1 results, rupee movement may dictate trend

The next batch of quarterly earnings, movement of rupee, trend in investment by foreign institutional investors and trend in global markets will dictate trend on the bourses in a truncated trading week. The stock market remains closed on Friday, 9 August 2013, on account of Ramzan Id.

Shares of Bharat Heavy Electricals, Coal India and Grasim Industries will on Monday, 5 August 2013, react to their respective quarterly results which will be out on Saturday 3 August 2013.

Power utility Tata Power unveils Q1 results on Tuesday, 6 August 2013. Lupin, NMDC, Ranbaxy Laboratories and Tata Motors are set to unveil their quarterly earnings on Wednesday, 7 August 2013. Sun Pharmaceuticals Industries unveils Q1 results on Friday, 9 August 2013.

The Q1 results announced so far showed that the combined net profit of a total of 1,088 companies rose 10.3% to Rs 59510 crore on 6.4% growth in sales to Rs 588311 crore in Q1 June 2013 over Q1 June 2012.

On the macro front, good rains this year may boost farm output which in turn could help ease food inflation. Higher farm production could boost rural incomes and consumer spending at a time overall economic growth has slowed down. The India Meteorological Department (IMD) on 31 July 2013 said rainfall in August to September is expected to be 96% of the average for the same period in the past 50 years. Rainfall during the first half of the season was 17% above the average.

Rupee's volatility against the dollar remains a concern. The rupee has declined sharply against the dollar in the past few months.

The monsoon session of the Parliament begins on Monday, 5 August 2013. The session ends on 30 August 2013. The 26-day session is expected to take up for consideration several important legislations including Land Acquisition Bill, Insurance Bill, Pension Bill, Companies Bill and the Direct Tax Code Bill. Besides, the ordinance on Food Security Bill will come up for ratification.

On the global front, Asian markets will on Monday, 5 August 2013, react to the influential US non-farms payroll data for July 2013 which will be out on Friday, 2 August 2013. The job data is a key piece of data which the Federal Reserve monitors in its assessment of its monetary-stimulus program. The Fed currently buys $85 billion a month in government and mortgage bonds in an effort to keep interest rates low and stimulate economic growth. After its two-day policy meeting on 30-31 July 2013, the Fed slightly downgraded its economic view and didn't offer any signals as to when it would start tapering asset purchases.