US presidential election, Fed interest rate decision to influence investors

Stock markets will be affected in the coming week by the US presidential election, the Fed’s interest rate decision and the trading outlook of foreign investors, analysts noted. The experts said that corporate profits of domestic companies will also have an effect on market sentiment.

The US presidential elections are scheduled this week for November 5. Furthermore, the Federal Reserve will also hold its meeting to decide on the upcoming monetary policy. Moreover, global trends will be keenly observed by market participants, PTI reported.

Elaborating on the week ahead, Santosh Meena, Head of Research at Swastika Investmart Ltd, commented: “The week ahead is set to be eventful on the global front. The US presidential election on November 5 is a key focus, and the US FOMC (Federal Open Market Committee) meeting will be crucial. Geopolitical tensions and oil price movements will also remain important variables.”

Meena pointed out that the final phase of second quarter earnings reports will take place this week. Palka Arora Chopra, managing director of Master Capital Services Ltd, said several macro figures will be unveiled this week.

“The market outlook will be determined by the US presidential election and key macroeconomic data such as HSBC India’s manufacturing PMI, services PMI, US Fed interest rate decision, global S&P composite PMI of the US, the US S&P global services PMI and the BoE (Bank of England) interest rate decision,” said Chopra.

It is striking that the stock market had a good rally last week. The BSE benchmark Sensex rose 321.83 points or 0.40 percent. The stock exchanges also held a special one-hour ‘Muhurat Trading’ session to celebrate the festival of Diwali on November 1. This also marked the beginning of the new Samvat 2081.

Ajit Mishra, SVP, Research, Religare Broking Ltd, explained: “This week, investors’ attention will be on developments in the US markets, especially the upcoming elections on November 5 and the Federal Reserve policy meeting. On the domestic front, the focus will be on earnings reports from key companies including Dr Reddy’s, Titan, Tata Steel, M&M and Tata Motors. In addition, the release of key economic indicators such as the HSBC PMI for manufacturing and services sectors will provide insight into the country’s economic momentum.”

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