Indian benchmark indices retreated more than two percent from recent peaks dragged by IT and select financial stocks amid fluctuations in global markets. The Sensex index shed nearly 1,650 points from an all-time high atop Mount 16,000 last week.

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For the week, the 30-scrip index lost 1,282.9 points or 2.1 percent to shut shop at 58,765.6 and the Nifty50 gauge 321.2 points or 1.8 percent to give up the 17,550 mark.

Now all eyes are on the outcome of the RBI's scheduled policy meeting due on October 8. Globally, investors will watch out for a meeting of top oil producers, and jobs data from the US.

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Dalal Street week ahead

This week, analysts will closely track the outcome of the Monetary Policy Committee's bi-monthly policy review and the onset of financial results for the quarter ended September 30. The reading of a private survey on India's services sector will be watched. A meeting of the group of top oil producers known as OPEC Plus (the Organization of the Petroleum Exporting Countries) will also be on their radar.

"The central bank is expected to maintain its accommodative stance to maintain adequate liquidity in the system and to support economic activity," said Vinod Nair, Head of Research at Geojit Financial Services.

Traders should expect an action-packed week ahead.

"Given that economic activity has not yet returned to pre-pandemic levels, the RBI is unlikely to remove the economy's training wheels. Any deviation from this stance, however, may result in whipsaw movements... Market participants should brace for greater volatility in crude oil prices," said brokerage Samco.

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Technical outlook

Nifty, though moving around its short-term averages, is still outperforming its global peers and looks overbought in the short term, according to Samco. "A further slight correction up to 17,250-17,200 levels cannot be ruled out. Traders are suggested to again take a 'buy on dips' approach as the positional outlook still remains bullish as long as the index does not break below 17,000," it said.

Here are the key factors and events that are likely to influence Dalal Street in the week starting October 4:

DOMESTIC CUES

RBI policy

The central bank's six-member Monetary Policy Committee will release its statement after a three-day meeting that ends on October 8.

Services PMI

The services PMI reading for September by Markit will be out on Thursday.

Earnings

TCS will kick off the earnings season by reporting its financial results for the July-September period after market hours on Friday.

FII flow

Fund flow will be in focus as foreign portfolio investors (FPI) remain bullish on Indian equities. They net bought Indian shares worth Rs 13,154 crore ($1.8 billion ) last month, exchange data showed.

GLOBAL CUES

OPEC meeting

The OPEC Plus group meets on Monday to review the output policy. On Friday, crude oil rose above $78 a barrel near a three-year high on expectations OPEC ministers will maintain a steady pace in raising supply. In July, the group agreed to boost output by 4 lakh bpd a month.

US infra package

Developments in Washington will be monitored keenly as lawmakers continue to debate an infrastructure spending package.

US jobs data

Data on employment in the US will be released on Friday. It comes at a time when the Federal Reserve's hawkish tilt led to a spike in US bond yields.

Evergrande crisis

After the financially-troubled China Evergrande missed deadlines to pay interest on certain bonds, the property developer decided to sell off its stake in a local bank for about $1.5 billion. But Evergrande has $300 billion in debt.

CORPORATE ACTION

(Edited by : Aditi Gautam)

First Published:Oct 3, 2021 11:39 AM IST