Geopolitical tensions, progress of monsoon to decide near term trend
The focus of investors will shift on progress of monsoon and geopolitical situation in Iraq and Ukraine in the coming week, amid lack of major domestic macro economic data next week.
Trend in investment by foreign portfolio investors (FPIs), trend in global markets, trend in other global emerging markets, the movement of rupee against the dollar and crude oil price movements hold key.
Progress of monsoon will be closely tracked by the investors. The India Meteorological Department (IMD) on 12 August 2013, said that the rainfall during August is likely to be normal (96 ± 9% of LPA) as was forecasted in June. The rainfall during the second half of the 2014 southwest monsoon
The latest estimate suggest the 2014 southwest monsoon season (June to September) rainfall over the country as a whole is likely to be 87% of the LPA with a model error of ±4%. Region wise, the season (June to September) rainfall is likely to be 76% of LPA over North-West India, 89% of LPA over Central India, 87% of LPA over South Peninsula, and 93% of LPA over North-East India all with a model error of ± 8 %.
India's farming sector accounts for around 14% of the economy, but two-thirds of the nation's 1.2 billion people depend on farming for a livelihood and more than half of its arable land needs the summer rains.
Meanwhile, the combined net profit of a total of 2,863 companies rose 34.8% to Rs 103835 crore on 10% rise in sales to Rs 1342975 crore in Q1 June 2014 over Q1 June 2013.
The government will announce Q1 June 2014 Gross Domestic Product (GDP) data on 29 August 2014. The GDP grew 4.6% in Q4 March 2014. The GDP grew by 4.7% in fiscal year ended 31 March 2014 (FY2014) from 4.5% in FY2013.
Metal stocks will be in focus on Thursday, 21 August 2014, as Markit Economics will announce on that day a preliminary reading of China's HSBC PMI index for August, indicating health of China's manufacturing activity. China is the world's largest consumer of steel, copper and aluminum.
Russia reportedly sent a convoy of 280 trucks carrying what it said was humanitarian aid for war-torn cities in eastern Ukraine on 12 August 2014, setting off diplomatic tension over efforts to ease civilian suffering there. The back-and-forth over the shipment raised fears of new tensions between Russia and Ukraine. Moscow, which is accused of supporting the pro-Russia separatists in their four-month-old rebellion, has accused Kiev of not doing enough to ease the suffering of civilians, particularly in the rebel-controlled cities of Donetsk and Luhansk.
About 130 more American troops have reportedly arrived in Iraq to help with its humanitarian crisis in the north of Iraq,. The troops are not there for combat and the American mission remains “limited,” report added. Last week the US President Barak Obama ordered targeted airstrikes and humanitarian air drops to assist the Yazidis, a group of religious minorities who are trapped on a mountain without food or water. Airstrikes were conducted on forces of the self-styled Islamic State, an al Qaeda offshoot called ISIS, as they tried to advance on Arbil, capital of Iraq's semi-autonomous Kurdistan region, and attacked tens of thousands of civilians near the town of Sinjar. (Data : Capital Market)
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