Market Ahead, Aug 31: Top factors that could guide markets this week

The Indian markets last week were buoyant, with both the Sensex and the Nifty rising 2 per cent each to over six-month high.

In this data-heavy week, domestic equity bourses will be guided by Q1 GDP print, infrastructure output data for July and monthly auto sales numbers, as investors will try and gauge the health of the economy. Meanwhile, the investor focus will also remain on global market trends and Covid-19 updates.

Today, the market will first react to Reliance Industries' acquisition of retail & wholesale business and the logistics & warehousing business of the Future Group for Rs 24,713 crore. Apart from that, the focus will also be on the June quarter GDP data which will be released by the National Statistical Office today. Estimates of decline in GDP are going up to 35 per cent due to the impact of lockdown amid the pandemic, although the statistics office may show only a 15-16 per cent fall because it does not have the data on the informal sector and uses proxies for that.

Among other economic data points, Infrastructure Output for July will also be released today, while Markit Manufacturing PMI will be announced tomorrow and Services PMI for August on Thursday.

Market participants may also react to the Union Home Ministry's decision to issue the Unlock 4 guidelines under which metro trains will be allowed to resume services from September 7 in a graded manner, while political, social and religious congregations of up to 100 people will be permitted from September 21. Meanwhile, India's Covid-19 case tally crossed 36-lakh mark with a spike of 79,467 new cases in the last 24 hours, Worldometer showed. Death toll stood at 64,617.

Besides, auto companies will announce their monthly sales data for August this week, starting Tuesday.

Market participants will also monitor the foreign fund flow, Rupee's trajectory, and oil price movement. Moreover, the new mechanism on margin pledge in cash market is due to come into force from September 1.

Investors will also keep a keen eye on the corporate results this week for stock-specific moves. More than 300 companies, including ONGC, Coal India, Dish TV, and Jubilant Foodworks, are scheduled to release their quarterly earnings report this week.

Investors will also await the Supreme Court judgement on the AGR dues, which is expected this week.

And, finally a quick look at the trade setup for today.

The SGX Nifty was trading around 60 points higher at 7:30 am, indicating a positive start for the Indian markets today. In Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.2 per cent to reach its highest since June 2018. Tokyo's Nikkei rallied 1.9 per cent.The next event of note in Asia will be China’s official manufacturing PMI survey for August.

In commodity markets, Brent crude was last trading 0.57 per cent higher at $46.07 per barrel.