NEW DELHI: Indian stock markets, which have been clawing their way back up the charts over the last few days, are expected to be driven by the release of several important macroeconomic indicators including the latest inflation and factory output data. The bourses, however, will remain closed on Thursday on account of Ganesh Chaturthi.
As for the indicators set to be published, the index of industrial production for the month of July will be announced Wednesday, as will the inflation rate based on the Consumer Price Index (CPI) for August. Wholesale Price Index-based inflation data is expected to be out Friday. On the international front, the release of US’ most recent jobs data is also expected to give cues to the markets. Inflation data, in particular, is expected to influence investor sentiment since high crude prices have already resulted in record-breaking fuel rates at the pumps.
If inflation data shows the effect starting to bleed into other segments like food and other consumables, experts expect it to put pressure on the RBI to hike rates again. Analysts also say the direction the rupee takes will strongly affect investor sentiment. It had been a combination of the rupee plunging and crude oil prices rising that had resulted in a drop in the markets last week. Market participants are expected to keep an eye on the progression of the US-China trade negotiations. Both the US and China have escalated rhetoric over the last few days.