Feb 3-8 key developments: RBI's MPC meeting, key firms to announce earnings, and more
Among the major happenings this week include investors keeping a keen eye on multiple economic data points from the United States on the global front, which could influence the Federal Reserve’s monetary policy stance in March 2025
This week is set to witness the Reserve Bank of India’s first monetary policy meeting of the year while more than 750 companies are set to release their financial results for the December 2024 quarter among other things.
Here are the key developments for this week, from February 3 to 8.
RBI outlook
With the Union Budget now in the rearview mirror, investors and analysts are turning their attention to the Reserve Bank of India’s (RBI) first monetary policy meeting of the year. Scheduled to take place from February 5 to 7, the RBI’s Monetary Policy Committee (MPC) deliberations are expected to play a crucial role in shaping market sentiment and financial dynamics.
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The central bank is widely anticipated to cut the benchmark repo rate by 25 basis points (bps), bringing it down from 6.5 per cent to 6.25 per cent. The move would boost economic growth amid global uncertainties and moderate inflation. However, traders and analysts will also pay close attention to the commentary from the newly appointed RBI Governor, Sanjay Malhotra, who will lead his first policy review. His stance on inflation control, liquidity management, and further economic stimulus measures will be key in shaping market sentiment.
Corporate earnings
The upcoming week will see a flurry of corporate earnings announcements as over 750 companies are set to release their financial results for the December 2024 quarter. Key Nifty 50 firms reporting their earnings include State Bank of India, Bharti Airtel, ITC, Britannia Industries, Hero MotoCorp, and Mahindra & Mahindra, Power Grid Corporation of India, Asian Paints, Titan Company. The others include Birla Capital, Gland Pharma, Thermax, Torrent Power, Cummins India, Life Insurance Corporation of India (LIC), Tata Power, Aurobindo Pharma, Zydus Lifesciences, Aditya Apollo Tyres, NMDC, Trent, and Delhivery.
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US jobs data
Investors will keep a keen eye on multiple economic data points from the United States on the global front, which could influence the Federal Reserve’s monetary policy stance in March 2025. Federal Reserve Chair Jerome Powell has emphasised that economic data will guide upcoming rate decisions. With the Fed’s preferred inflation measure exceeding the 2 per cent target, the central bank appears likely to maintain its pause on rate cuts. Robust job growth could add to inflation concerns, shaped by policy shifts under the Trump administration, particularly in trade and immigration.
Economic reports
Apart from the RBI’s policy meeting, another critical event in global monetary policy is the Bank of England’s (BoE) decision on February 6. The BoE is expected to reduce its benchmark interest rate by 25 bps, significantly as UK inflation cooled to 2.5 per cent in December 2024, down from 2.6 per cent the previous month.
Additionally, market participants will track various economic indicators from around the world. These include:
China: Inflation figures and Producer Price Index (PPI)
Europe: Retail sales data and inflation numbers
India: HSBC India Manufacturing PMI (February 3) and Services PMI (February 5), with preliminary figures indicating a mixed trend in January 2025. The Manufacturing PMI rose to 58 from 56.4 in December, while the Services PMI dropped to 56.8 from a four-month high of 59.3.
Foreign Exchange Reserves: India’s forex reserves, which stood at $629.56 billion as of January 24, will see an update on February 7.
Market sentiment
Institutional investor activity will be another key aspect to monitor in the coming week. Foreign Institutional Investors (FIIs) have continued a selling spree in Indian equities, offloading a net amount of Rs 87,375 crore in January. This marks the second-largest monthly outflow after October 2024, when net sales hit Rs 1.14 lakh crore. For the past week alone, FIIs sold Rs 19,622 crore worth of stocks. However, domestic institutional investors (DIIs) have soaked in the selling pressure, net buying Rs 86,592 crore shares in January, which has led to stability in the market despite foreign outflows.
IPO listings
In the primary market, five new public issues from the SME segment will open for subscription next week, including Amwill Healthcare, Ken Enterprises, Chamunda Electricals, Eleganz Interiors, and Readymix Construction Machinery,
Additionally, Dr Agarwal’s Health Care and Malpani Pipes and Fittings from the SME segment will debut on the stock exchanges next week.