The Indian stock market is set to focus on key factors this week, including inflation data, second-quarter earnings, and foreign portfolio investor (FPI) flows. The consumer price index (CPI) inflation data for September, due on October 12, and the wholesale price index (WPI) data on October 14, will be closely watched following the Reserve Bank of India's recent repo rate hike to 5.50%. These inflation readings could influence future policy decisions by the central bank.
Earnings season is also in full swing, with major companies like HCL Technologies, Hero MotoCorp, Tech Mahindra, Wipro, and Nestle India scheduled to release their Q2 FY27 results. Investors will be analyzing management commentary on demand conditions, revenue growth, and margins to gauge the sustainability of the market's recovery.
Globally, US inflation data and retail sales will be crucial for investor sentiment. The core Consumer Price Index (CPI) inflation report is set for October 14, followed by core retail sales data on October 15. These figures will help determine the path of interest rates and the Federal Reserve's policy outlook, impacting equity valuations, particularly in rate-sensitive sectors.
Other variables to monitor include US Treasury yields, currently at 5.24%, and crude oil prices, with Brent crude trading at $104.70 per barrel and West Texas Intermediate (WTI) crude at $91.85 per barrel. Elevated oil prices pose risks to India's inflation and current account outlook, as well as the rupee's movement against the dollar, which was trading at 96.77 against the dollar.