Market may remain volatile ahead of near month F&O expiry
Progress of monsoon rains, the outcome of the monthly surveys on India's manufacturing and services sectors, trend in global markets, investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs), the movement of rupee against the dollar and crude oil price movement will dictate market trend in the near term.
The market may remain volatile as traders roll over positions in the futures & options (F&O) segment from the near month June 2016 series to July 2016 series. The near month June 2016 derivatives contracts expire on Thursday, 30 June 2016.
Volatility may also remain high in the near future after an outcome of a British referendum stunned global financial markets on Friday, 24 June 2016 showing that UK had voted to leave the European Union in a historic referendum dubbed "Brexit". Global stocks had risen recently as investors bet that Britons would vote to reject Brexit, or a British exit from the European Union.
Investors will closely watch the progress of monsoon rains. According to the India Meteorological Department (IMD), the country has received overall 92.10 mm of rainfall as compared to normal level of 110.8 mm from 1 June to 23 June 2016, an overall deficiency of 17%. IMD in its second stage forecast on 3 June 2016 had stuck to its preliminary forecast of above normal rains for the 2016 southwest monsoon season (June to September). Quantitatively, monsoon season rainfall for the country as a whole is likely to be 106% of the long period average (LPA) with a model error of plus/minus 4%, IMD had said.
Stocks of auto companies will be in focus as companies start unveiling monthly sales volume data for June 2016 from Friday, 1 July 2016.
Stocks of public sector oil marketing companies (PSU OMCs) will be in focus as a fuel price review is due at the end of the month. PSU OMCs undertake fuel price review twice during the month based on the trend in international oil market. The first price review takes place during the middle of the month and the second on the last day of the month. Aviation stocks will be in focus as a monthly review of jet fuel prices is due at the end of the month. PSU OMCs review jet fuel prices on the last day every month based on the average imported crude oil price for the month. Jet fuel prices are directly linked to crude oil price.
Among domestic macro economic data, Markit Economics will announce the India Manufacturing PMI for June 2016 on Friday, 1 July 2016. The Nikkei India Services PMI will be declared on Tuesday, 5 July 2016.
On the global front, China's official June manufacturing purchasing managers' index will be announced on Friday, 1 July 2016. On the same day, Markit Economics will announce Caixin China General Manufacturing PMI for June 2016. The European Central Bank (ECB) starts its three-day Forum on Central Banking in Sintra, Portugal on Monday, 27 June 2016. Speakers include ECB President Mario Draghi, Federal Reserve Chair Janet Yellen and Bank of England Governor Mark Carney. Negative interest rates and the aftermath of the UK referendum on the European Union will be among the issues discussed. In US, the Bureau of Economic Analysis will release the third estimate of Gross Domestic Product for first quarter of 2016.
The market may remain volatile as traders roll over positions in the futures & options (F&O) segment from the near month June 2016 series to July 2016 series. The near month June 2016 derivatives contracts expire on Thursday, 30 June 2016.
Volatility may also remain high in the near future after an outcome of a British referendum stunned global financial markets on Friday, 24 June 2016 showing that UK had voted to leave the European Union in a historic referendum dubbed "Brexit". Global stocks had risen recently as investors bet that Britons would vote to reject Brexit, or a British exit from the European Union.
Investors will closely watch the progress of monsoon rains. According to the India Meteorological Department (IMD), the country has received overall 92.10 mm of rainfall as compared to normal level of 110.8 mm from 1 June to 23 June 2016, an overall deficiency of 17%. IMD in its second stage forecast on 3 June 2016 had stuck to its preliminary forecast of above normal rains for the 2016 southwest monsoon season (June to September). Quantitatively, monsoon season rainfall for the country as a whole is likely to be 106% of the long period average (LPA) with a model error of plus/minus 4%, IMD had said.
Stocks of auto companies will be in focus as companies start unveiling monthly sales volume data for June 2016 from Friday, 1 July 2016.
Stocks of public sector oil marketing companies (PSU OMCs) will be in focus as a fuel price review is due at the end of the month. PSU OMCs undertake fuel price review twice during the month based on the trend in international oil market. The first price review takes place during the middle of the month and the second on the last day of the month. Aviation stocks will be in focus as a monthly review of jet fuel prices is due at the end of the month. PSU OMCs review jet fuel prices on the last day every month based on the average imported crude oil price for the month. Jet fuel prices are directly linked to crude oil price.
Among domestic macro economic data, Markit Economics will announce the India Manufacturing PMI for June 2016 on Friday, 1 July 2016. The Nikkei India Services PMI will be declared on Tuesday, 5 July 2016.
On the global front, China's official June manufacturing purchasing managers' index will be announced on Friday, 1 July 2016. On the same day, Markit Economics will announce Caixin China General Manufacturing PMI for June 2016. The European Central Bank (ECB) starts its three-day Forum on Central Banking in Sintra, Portugal on Monday, 27 June 2016. Speakers include ECB President Mario Draghi, Federal Reserve Chair Janet Yellen and Bank of England Governor Mark Carney. Negative interest rates and the aftermath of the UK referendum on the European Union will be among the issues discussed. In US, the Bureau of Economic Analysis will release the third estimate of Gross Domestic Product for first quarter of 2016.
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