Invest in Credit Risk Mutual Fund or not?

Macroeconomic data coupled with March quarter results, the progress of monsoon, Covid updates, initial public offerings and global cues will guide the stock market in the coming week. Earlier, the benchmark equity index BSE Sensex advanced 374.71 points or 0.72% to 52,474.76 for the week ended June 11. Likewise, the NSE Nifty index gained 129.10 or 0.82% to 15,799.35. Here are key factors that may steer the market:

Inflows and Economic data
In economic data, WPI inflation for May 2021 is due on 14 June 2021. RBI will unveil the minutes of the Monetary Policy Meeting concluded on 4 June 2021. Besides, the movement of the rupee against the dollar and crude oil prices, the trend in global stock markets will dictate the trend on the bourses in the near term. Investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) will be monitored.

US bond yields
The key thing to watch out for in the near future would be the US bond yields because any rise in yields can take out the FII money from developing countries like India to western markets and could also be a risk for emerging markets currencies. The Dollar Index, which measures the US currency against a basket of six peers, will also be closely watched.

Covid updates
On the coronavirus front, investors would continuously watch out government’s course of action along with progress on the vaccination drive. Besides, as new Covid cases have seen a considerable decline, all eyes would be on state governments for further easing of the restrictions.

Monsoon
Progress of monsoon will be closely watched. The Indian Meteorological Department has predicted a normal monsoon in most parts of the country in June. As per the weather department, the country is likely to experience 101% rainfall during the monsoon season. The IMD will issue the forecast for the July rainfall in the last week of June 2021.

G7 Summit
Meanwhile, as per reports, Prime Minister Narendra Modi will virtually participate in the outreach sessions of the G7 Summit on June 12 and 13 where leaders are to exchange views on the way forward on global recovery from the pandemic.

Global cues
Overseas, Japan’s final industrial production data for April will be announced on 14 June 2021. US Retail Sales for May will be announced on 15 June 2021. The US Federal Reserve (Fed) will wrap up its two-day policy meeting on 16 June 2021. Euro Area’s industrial production data for April will be announced on 14 June 2021.

IPO
At least four initial public offerings (IPO) including Sona BLW Precision Forgings, Shyam Metalics and Energy, Dodla Dairy and Krishna Institute of Medical Sciences (KIMS) to hit the primary market to raise over Rs 8,500 crore.