In the coming week, developments related to roll-out of Goods and Service Tax (GST), progress of monsoon rains, domestic and global macroeconomic data, trend in global markets, investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs),
the movement of rupee against the dollar and crude oil price movement will dictate trend on the bourses.
Domestic stock markets will remain closed on Monday, 26 June 2017 on account of Id-Ul-Fitr (Ramzan Id).
The market may remain volatile as traders roll over positions in the futures & options (F&O) segment from the near month June 2017 series to July 2017 series. The near month June 2017 derivatives contract expire on Thursday, 29 June 2017.
The progress of monsoon rains will be closely watched. The IMD said that for the country as a whole, cumulative rainfall during this year’s monsoon upto 22 June has been 4% above the Long Period Average (LPA). The June-September southwest monsoon is critical for the country’s agriculture because a considerable part of the country’s farmland is dependent on the rains for irrigation.
The Indian Meteorological Department (IMD) in its second stage forecast of Southwest monsoon seasonal rainfall issued on 6 June 2017 had said that quantitatively, monsoon seasonal rainfall for the country as a whole is likely to be 98% of the long period average (LPA) with an error of ± 4%.
The implementation of landmark tax reform Goods and Service Tax (GST) will be closely watched. All the States and Union Territories (having assemblies), except the State of Jammu & Kashmir, have approved the State Goods and Services Tax (SGST) Act. Almost the entire country including all the 30 States/UTs are now on board and ready for the roll-out of GST.
On the night of 30 June 2017, there will be a special function in the Central Hall of Parliament House wherein a number of programs will be witness to the change in tax structure and implementation of GST across the country between the night of June 30 and July 1. The government expects GST to revolutionise India’s taxing system and is being marketed as one nation one tax.
The infrastructure output data for May 2017 will be declared by government on Friday, 30 June 2017. Infrastructure output went up 2.5% year-on-year in April of 2017 after an upwardly revised 5.3% rise in March.
On the global front, the US durable goods orders for May 2017 will be released on Monday, 26 June 2017. New orders for US manufactured durable goods fell 0.7% month-over-month in April 2017, following an upwardly revised 2.3% jump in March.
The US GDP growth rate will be declared on Thursday, 29 June 2017. The US economy expanded an annualized 1.2% on quarter in the first three months of 2017, better than the advance estimate of 0.7% growth.
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