Stock Market Outlook: Focus on global trends; may face volatility amid derivatives expiry - What analysts predicted

With no major domestic market-moving event scheduled this week, stock market investors would largely focus on global trends and foreign fund movement, and may face volatility amid monthly derivatives expiry, analysts said.

This week Federal Open Market Committee (FOMC) meeting minutes are due for release which would provide further cues to the market, Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, said.

"With all major events behind us, participants will take cues from global markets, crude and currency market movement. Besides, the scheduled monthly expiry of November month derivatives contracts would keep traders on their toes," Ajit Mishra, VP - Research, Religare Broking Ltd, said.

Last week, the Sensex dipped 131.56 points or 0.21 per cent, while the Nifty declined 42.05 points or 0.22 per cent. Of late global markets have also been facing a lacklustre trend.

"The market remained range-bound amid lack of cues, and it will look for direction ahead of the F&O expiry. The good part is that the market is just breathing after a long run-up, and there is a good probability of an upside breakout. However, we are seeing profit-booking in the broader market," said Pravesh Gour, Senior Technical Analyst, Swastika Investmart Ltd.

Apart from F&O expiry, institutional flows will be important, which have dried up in the last couple of trading sessions, he said.

"On the global front, the minutes of the US FOMC meeting will lead to some volatility in the global markets. Movement of the dollar index, US bond yields and crude oil prices will remain other critical factors to watch out for," Gour added.

Analysts said that in the recent recovery, the domestic markets were showing resilience when the global indices especially the US markets were facing the heat.

Vinod Nair, Head of Research at Geojit Financial services, said, "In the absence of major domestic triggers, the domestic market is expected to continue its focus on global trends."

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