The Indian equity benchmarks, the BSE Sensex and the NSE Nifty, are set to start the week on a flat note, following mixed cues from Asian peers as Wall Street futures slip, indicating a downside risk for the market. The soft trends on SGX Nifty also indicated a muted opening for the domestic bourses, with SGX Nifty futures trading 19 points, or 0.12%, lower at 15,725 on the Singapore Stock Exchange at 8:15 AM. The key factors that will drive domestic bourses this week includes, global cues, macro data, crude movement, Russia-Ukraine crisis, and FIIs activity. Investors will also keep an eye on the corporate earnings season, which will begin this week with IT major TCS announcing its numbers on July 8.

"Market movements this month are likely to be significantly influenced by the Q1 results starting with TCS's results on 8th July. More than the actual numbers, the market will be focussed on the guidance. Similarly, in financials particularly banking, the market will be keen to know the trends in credit growth rather than the decline in treasury income, which is already known,” says V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

“The buoyancy in GST collections and June auto numbers indicate that economic recovery is gaining momentum, in spite of many headwinds, and this bodes well for the market's performance in H2 FY23.
In the present context of high near-term uncertainty, the best strategy for investors would be to buy high-quality large-caps in a calibrated manner and wait with patience," he adds.

Last week, the Indian share market settled on a positive note, with the Sensex rising 180 points, while the broader Nifty added 53 points. On Friday, the 30-share Sensex closed lower, weighed down by oil and gas stocks after the government imposed taxes on exports of petroleum products. The BSE benchmark fell 111 points to 52,908, and 50-share Nifty closed 28 points lower at 15,752 in volatile trade. The top losers on the BSE Sensex pack were Reliance Industries, PowerGrid, NTPC, and Bharti Airtel, while ITC, Bajaj twins and Asian Paints were among notable gainers.

Stocks to watch

HDFC, HDFC Bank: The proposed merger of HDFC with its banking subsidiary HDFC Bank has been cleared by the stock exchanges. The deal required approvals from market regulators including RBI and CCI before it goes to NCLT and shareholders.

Bharat Forge: The company and its subsidiary have completed the acquisition of JS Auto Cast Foundry India at an enterprise value of ₹489.63 crore.

Birlasoft: The company has fixed July 15 as the record date for the proposed buyback of up to 78 lakh shares at ₹500 each, amounting to ₹390 crore.

NTPC: The state-owned company said that its 100 megawatts (MW) floating solar photovoltaic project in Telangana was fully operational.

Glenmark Pharmaceuticals: The U.S. drug regulator has issued Form 483 with one observation for the company’s formulation manufacturing facility based in Aurangabad, India.

Ashoka Buildcon: The joint venture led by Ashoka Buildcon has emerged as ‘the lowest bidder’ for the construction and maintenance of Rajiv Gandhi Fintech Digital Institute, Jodhpur.

Coal India (CIL): The state-owned firm has reported a 29% YoY rise in coal production to a record 159.8 MT in the April-June quarter of this fiscal.

Here are the key things investors should know before the market opens today:

Wall Street surges

On Friday, all three major U.S. indices ended higher in a relief rally ahead of the long holiday weekend. The U.S. markets will be closed today for the Fourth of July holiday. The S&P 500 index rose 1.06%, the Dow Jones Industrial Average added 1.05%, and the Nasdaq Composite gained 0.9%. The experts expect stock market performance to improve in the second half of the year, with investors keeping an eye on the second-quarter earnings season, June job data, and the Federal Reserve's monetary policy meeting later this month.

Asian stocks mixed

Shares in the Asia-Pacific region traded mixed on Monday, despite positive closing on Wall Street on Friday. The regional market witnessed cautious trading as investors remained concerned ahead of minutes of the Fed's June policy meeting on Wednesday and payrolls report on Friday.

Regional heavyweight Japan’s Nikkei 225 was up 0.6%, the Straits Times Index in Singapore gained 0.5%, and Australia’s ASX 200 rallied 1.1%.

In Hong Kong, the Hang Seng index fell 0.95%, South Korea’s Kospi dropped 0.35%, Taiwan Weighted slipped 0.1%, and Indonesia’s Jakarta Composite dived 1.4%.

Markets in mainland China were trading mixed, with the Shanghai Composite falling tad lower, while the Shenzhen Component rose 0.4%.

Crude prices edge lower

The price of Brent and U.S. crude fell marginally in early trade on Monday amid worries that the global economic slowdown could dent demand. However, supply outages in Libya and expected shutdowns in Norway limited the downfall. In Asian trading hours, the Brent oil for August delivery slipped 0.37% to $111.2 per barrel, while the U.S. West Texas Intermediate (WTI) crude August futures were down 0.35% at $108.5 a barrel.

FPIs pull out ₹50,203 crore from equity market in June

The foreign investors continued their selling spree in the Indian equity market for the ninth consecutive month in June, withdrawing ₹50,203 crore during the same period. Foreign portfolio investors (FPIs) have withdrawn ₹2.2 lakh crore from domestic equities in the first six months of 2022, the highest-ever funds outflow by them.

The sustained selling by foreign investors can be attributed to the rweak rupee, aggressive rate hikes by the U.S. Federal Reserve, elevated inflation, and relatively higher valuation of domestic equities.

Extending its massive selling streak, FPIs have withdrawn around ₹811 crore cumulatively from the Indian market on the first day of July 1.

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