RBI’s monetary policy will decide the movement of the market

Mumbai (U)The Hindu News): The Reserve Bank of India (RBI) has decided to set the direction for the next week of the domestic stock market, which has jumped 2.5 percent last week due to strong buying at the local level due to the rapid rise of the global market in the hope of averting the banking crisis in America. RBI’s monetary policy review will play an important role.

Last week, the BSE’s 30-share sensitive index Sensex gained 1464.42 points, or 2.55 percent, to 58991.52 points on the weekend and the National Stock Exchange (NSE) Nifty jumped 414.7 points, or 2.45 percent, to 17359.75 points.

In the week under review, like the big companies, there was a lot of buying in the mid-sized companies of BSE. Due to this, Midcap gained 432.03 points to reach 24065.59 points on the weekend and Smallcap gained 190.01 points to reach 26957.01 points.

Hopes of averting a banking crisis have risen after First Citizens Bank’s successful buyout of deposits and loans from America’s troubled Silicon Valley bank, according to analysts. Due to this, the global market gained momentum, due to which both the benchmark indices Sensex and Nifty had a bullish trend in the past week. The developments related to the banking sector at the global level will have an impact on the market in the next week as well.

At the local level, the first bi-monthly monetary policy review meeting of the current financial year of RBI is going to be held next week. Keeping in view the current economic scenario after increasing the policy rates for five consecutive times, it is expected that RBI may keep the interest rates stable this time. However, in view of the global scenario, even if there is an increase in the policy rates, it will not be more than 0.25 percent. Its effect will also be on the market next week.

Apart from this, investors will also keep an eye on crude oil price, dollar index and FII investment flow. FIIs pulled out investments from the market for the last three consecutive months in December, January and February. But, so far in March, he has been a net buyer of Rs 1997.7 crore. Similarly, the net investment of Domestic Institutional Investors (DIIs) stood at Rs 30548.77 crore.