Market will react to global signals

Domestic stock market are gearing up to react to global cues next week, with investors closely watching US Federal Reserve Chair Jerome Powell's speech at Jackson Hole on Friday (23 August 2024). The market is eagerly anticipating hints about potential interest rate cuts and their timing, size, and pace.

While the market is currently pricing in a 60% chance of a 25 basis point rate cut in September and a 30% chance of a more aggressive 50 basis point cut, there remains some uncertainty. The recent weak NFP payroll data has increased expectations for a rate reduction, but the exact timing and magnitude remain to be seen.

 

Analysts believe that the Nifty index is likely to track gains in the US stock market. As the global economy continues to soften, the possibility of a "soft landing" is increasing, which could benefit emerging markets like India. A rate cut by the Fed would further bolster market sentiment and drive up stock prices.

India's infrastructure output data for July will release on Friday, 30 August 2024. Infrastructure output in India rose 4% year-on-year in June 2024, following a 6.3% increase in May.

India's Q2 GDP data will release on Friday, 30 August 2024. The Indian economy expanded by 7.8% in Q1 of 2024, to extend the trend of strong growth for the Indian economy.

Global Cues:

US durable goods orders data for July will release on Monday, 26 August 2024. New orders for manufactured durable goods in the US slumped 6.6% month-over-month in June 2024, after four consecutive monthly increases.

Japan's consumer confidence data for August will release on Friday, 30 August 2024. The consumer confidence index in Japan climbed to 36.7 in July 2024 from 36.4 in the previous month.

US Core PCE Price Index for July will release on Friday, 30 August 2024. The US core PCE price index, the Federal Reserves preferred gauge to measure underlying inflation, rose by 0.2% from the previous month in June of 2024.

US personal income data for July will release on Friday, 30 August 2024. US personal income rose by 0.2% from the previous month to $23.948 trillion in June of 2024, slowing from a downwardly revised 0.4% increase in the previous month.

US personal spending data for July will release on Friday, 30 August 2024. Personal spending in the United States increased 0.3% from the previous month in June 2024, following an upwardly revised 0.4% rise in the previous month.

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