Dalal Street is set for a busy week as investors will be tracking domestic and global developments. The RBI’s interest rate decision, key economic data releases, crude oil prices and the evolving US-Iran situation are expected to be the main factors driving market sentiment. Market participants will also keep a close watch on macroeconomic indicators, foreign investor activity and movements in the rupee against the US dollar for cues on the near-term outlook for equities.“Participants will closely monitor global developments surrounding the US–Iran situation and movement in crude oil prices, which continue to remain critical for inflation expectations, currency stability, and foreign flows,” said Ajit Mishra, SVP, Research, Religare Broking Ltd.The week will begin with the release of the final HSBC Manufacturing PMI reading for May on Monday. This will be followed by the Services PMI and Composite PMI data on Wednesday, offering insights into demand trends, business activity and the resilience of growth across sectors.“The key event of the week will be the RBI monetary policy announcement on Friday,” Mishra added.Apart from the central bank’s policy decision, investors are expected to monitor India’s GDP growth figures and foreign exchange reserves data for a better understanding of economic momentum and the stability of the external sector.The upcoming week follows a negative close for the benchmark indices. Last week, the BSE Sensex declined 639.61 points, or 0.84 per cent, while the NSE Nifty fell 171.55 points, or 0.72 per cent.Ponmudi R, CEO of online trading and wealth tech firm Enrich Money, said investor attention would remain firmly fixed on geopolitical and economic developments.“Markets are expected to remain highly sensitive to geopolitical and macroeconomic developments this week, with investor attention firmly focused on the evolving US–Iran negotiations, broader diplomatic developments in the Middle East and the trajectory of crude oil prices,” he said.He added that market participants would also closely track rupee movements, institutional investment flows, global equity market trends and major macroeconomic indicators for further direction.Santosh Meena, Head of Research at Swastika Investmart Ltd, said the RBI policy meeting would be the most significant domestic event of the week.“The primary domestic event will be the RBI monetary policy meeting, with the announcement scheduled for Friday. Market participants will closely monitor the RBI’s stance on inflation, liquidity, and interest rates amid rising inflationary concerns and currency-related developments,” he said.Meena also noted that monthly automobile sales data for May, due to be released on June 1, would provide an indication of demand trends within the sector.Vinod Nair, Head of Research at Geojit Investments Limited, said the immediate direction of Indian equities would largely depend on the outcome of the RBI policy decision and the release of GDP data.Looking ahead, the near-term directional call for equities depends on two interlocking catalysts: the RBI monetary policy decision and India’s GDP data release, while India PMI and IIP data will provide the first meaningful read on early Q1FY27 industrial momentum, Nair said.
