Sensex, Nifty Closed Today: US Fed Decision, Inflation Data To Crude Prices; Key Factors To Drive Market This Week

The domestic stock markets are closed today, September 14, on the occasion of Ganesh Chaturthi. The usual trading operations on NSE and BSE will resume on Tuesday, September 15. Last week, the market remained highly pessimistic as key equity indices declined over 1.5 per cent. Meanwhile, according to analysts, the US Fed interest rate decision, domestic inflation data, movement in crude oil prices and fresh developments in the West Asia conflict would be the major drivers for stock market movement in a holiday-shortened week ahead.

NSE’s Nifty50 closed the week 1.60 per cent down, while BSE’s Sensex ended 1.93 per cent lower. On Friday itself, the Sensex closed 120 points lower at 74,781.76, while Nifty50 settled at 23,39, down 0.34 per cent. 

What Do Analysts Say? 

"Globally, developments in the US-Iran conflict and movement in Brent crude will remain critical market drivers. This week will be dominated by the US Federal Reserve''s monetary policy decision and commentary on the future path of interest rates," Ajit Mishra, SVP of Research at Religare Broking, said.

Domestically, he said, the focus will be on August WPI and CPI inflation data, followed by unemployment and trade reserves data.

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"The immediate focus will be on US inflation and the Federal Reserve''s policy decision. The September 11 inflation report showed headline CPI rising 0.4 per cent month-on-month and holding at 3.4 per cent annually, while core inflation increased 0.3 per cent from the previous month but eased to 2.4 per cent year-on-year. The firmer monthly reading keeps inflation risks in focus and could reinforce pressure on global bond yields and the dollar, particularly if the Federal Reserve adopts a more hawkish tone," Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, a Research Analyst firm, said.

The September 15–16 FOMC (Federal Open Market Committee) meeting will therefore be the week's principal global catalyst, he said.

Crude Remains Key Driver

According to the analyst, movement in crude oil prices will be the most immediate external risk for India.  If crude oil prices rise again due to disruption in the Middle East, it could intensify inflationary pressures, increase the import bill, weigh on the rupee and reduce corporate margins.

"Domestic data, including WPI inflation and trade figures, will provide additional clues on how much of that pressure is filtering into the economy," Radhakrishnan added.

Sensex Tanks 1,733 Points Last Week 

Last week, the BSE benchmark Sensex tumbled 1,733.67 points, or 2.26 per cent, and the NSE Nifty declined 499.6 points, or 2 per cent.

Also Read: Gold and Silver Market Outlook: Experts Highlight 3 Key Drivers For Bullion This Week

"Global macroeconomic and geopolitical risks are likely to keep Indian equities on edge in the week ahead, with crude oil prices, developments in the Middle East and shifting expectations for US monetary policy emerging as the key drivers of market sentiment," Ponmudi R, CEO, Enrich Money, an online trading and wealth tech firm, said.

(With Inputs From PTI)