Dalal Street Week Ahead: Venezuela crisis, oil prices, Q3 earnings, US jobs among 10 key factors to watch

Dalal Street Week Ahead

• Next week, the market focus will also be on US jobs, services PMI, and China inflation data as well as oil and precious metals prices.

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The market staged stellar performance in the week ended January 2, rising more than 1 percent to finish at record closing high after consolidation in past four weeks. Healthy expectations around upcoming December quarter (Q3FY26) earnings and likely supportive policy measures in the Union Budget boosted market sentiment as broader markets also gained momentum during the week.

Strong momentum in auto space with healthy December sales volumes data, PSU banking sector with improving asset quality and expectations of accelerated credit growth, and utilities segment on hopes of rising demand and increased industrial activity lifted market mood, though ITC-led selling pressure was seen in the FMCG sector. Precious metals saw profit booking last week with gold futures falling nearly 5 percent and silver futures declining 1.5 percent.

The market in the coming week starting from January 5 is expected to be rangebound with positive bias with focus on provisional quarterly business updates, though initially there could be some negative reaction to geopolitical tensions between US and Venezuela, experts said. Further, the focus will also be on US jobs, services PMI, and China inflation data as well as oil and precious metals prices.

The Nifty 50 rallied 286 points (1.1 percent) to 26,329, and the BSE Sensex rose 721 points (0.85 percent) to 85,762, while the Nifty Midcap and Smallcap 100 indices gained 1.74 percent and 0.77 percent, respectively.

Along with initial reaction to US enforcement on Venezuelan oil trade, for the week ahead, "investors will give attention to US payroll and unemployment data for global market direction," Vinod Nair, Head of Research at Geojit Investments said.

Overall, according to him, sentiment is expected to stay constructive, though markets may move within a steady range as participants wait for clearer earnings led triggers and clarity on the India-US trade deal.

Siddhartha Khemka - Head of Research, Wealth Management at Motilal Oswal Financial Services is also of the view that overall, markets are expected to remain firm, with investor focus on pre-quarterly business updates and the onset of the Q3 earnings season.

Here are 10 key factors to watch next week:

Q3 Earnings and Quarterly Provisional Updates

The market participants started focussing on the December quarter earnings season and the provisional updates as we entered January month. The market action seen last week may be on a hope that the earnings recovery from December quarter onward could be strong with upgrades outpacing downgrades.

Earnings season will kick off next week with Avenue Supermarts, GM Breweries, Premier Energy and Infrastructure, Eimco Elecon, Elecon Engineering, Transformers and Rectifiers (India), Globus Spirits, and Tejas Networks releasing their quarterly numbers but the major action will be seen in the following week (from January 12) when bluechips starts disclosing scorecard.

Geopolitical Tensions

Globally, markets across asset classes including especially oil and precious metals are expected to react to geopolitical tensions including US enforcement directed by Donald Trump on Venezuelan oil trade and renewed Russia–Ukraine strikes on energy infrastructure.

According to experts, commodity markets are likely to open sharply on edge Monday after US forces captured Venezuelan President Nicolás Maduro and his wife, charging them with drug trafficking following a major military operation on Saturday (January 3).

The escalation marks a major geopolitical shock, likely to sharply boost safe-haven demand for gold and silver and push oil prices higher amid serious concerns over supply disruptions from a country holding the world’s largest oil reserves, Kaynat Chinawala of Kotak Securities said.

US Jobs Data

Globally, the focus will also be on the upcoming US jobs report (including unemployment rate, JOLTs job openings & quits) for clues on further monetary policy action in upcoming Federal Reserve meetings. Most economists are not favouring for continuation of rate cut cycle in January meeting.

Further, factory orders, housing starts, wholesale inventories, ISM manufacturing data; and inflation expectations for last month and current month will also be watched.

Global Economic Data

Apart from geopolitical tensions and US data points, the market participants will keep an eye on the services PMI numbers from several nations including Japan, China, US and UK as well as Europe.

Europe's retail sales, PPI, and unemployment rate as well as China’s CPI & PPI numbers will also be closely monitored during the first full trading week of the year.

Domestic Economic Data

Back home, the market participants will focus on the HSBC Services PMI numbers for December due on January 6, followed by preliminary estimates for current fiscal year GDP estimates on January 7.

Preliminary estimates suggested that the services PMI dropped to 59.1 in December, slowing from 59.8 in November but remained in strong expansion mode, while most economists expect economy to grow in the 7.4-7.6 percent range and the RBI in its December policy meeting estimated growth at 7.3 percent, revising from 6.8 percent earlier against 6.5 percent growth in FY25.

Bank loan and deposit growth for fortnight ended December 26, and foreign exchange reserves for week ended January 2 will be released on final day of next week i.e. January 9.

FII Flow

The focus will also be on the activity at FIIs (Foreign Institutional Investors) desk as they remained relentless sellers last week and last month, offloading nearly Rs 13,200 crore and Rs 34,350 crore worth shares, respectively, as per the Moneycontrol data, though most experts are hoping that flow could get gradually reversed in current year that recently started citing the potential earnings and economic growth going forward.

On the contrary, DIIs (Domestic Institutional Investors) continued to compensate the FII outflow by a strong margin, buying nearly Rs 17,800 crore worth shares in the week gone by and Rs 79,620 crore in December, the highest since August, which overall has been a good support to the market in every fall.

Meanwhile, the Indian rupee depreciated by 0.26 percent during the week to 89.975, extending weakness for second consecutive week, while the US dollar index remained rangebound below key moving averages as well as 100 mark, rising 0.39 percent to 98.43 levels.

IPO

The primary market will see five new Initial Public Offerings (IPOs) in the first full week of new year 2026 including one from the mainboard segment which is Bharat Coking Coal (BCCL), the subsidiary of Coal India.

BCCL, the India's largest coking coal producer, will launch its maiden public issue of 46.57 crore equity shares on January 9 and close on January 13. It is entirely an offer-for-sale by promoter Coal India, with no fresh issue component.

Other four public issues will be from the SME segment with Gabion Technologies India being the first opening on January 6 and closing on January 9. This follows Victory Electric Vehicles International, and Yajur Fibres IPOs which both will open on January 7 and close on January 9. Defrail Technologies will be last IPO, getting launched on January 9.

Meanwhile, Haryana-based Modern Diagnostic & Research Centre will make its debut on the BSE SME effective January 7 after closing its Rs 37-crore public issue with more than 350 times subscription last week.

Technical View

Technically, the Nifty 50 turned bullish with positive crossover in momentum and technical indicators. The index formed long green candle with lower shadow on the weekly scale, indicating healthy buying interest at upward sloping support trendline, while decisively breaking falling resistance trendline with above-average volumes. The next target is placed at the 26,500 followed by 26,700, however, the 26,100 is expected to act as an immediate support, followed by the 26,000 being crucial support as below which the bullish momentum may get lost, experts said.

F&O Cues, India VIX

The weekly options data suggested that the Nifty 50 is expected to be trade in the 26,000-26,500 range next week. The maximum Call open interest was placed at the 27,000 strike, followed by the 26,500 and 26,600 strikes, with the maximum Call writing at the 26,500, 27,000 and 26,650 strikes, while the 26,000 strike holds the maximum Put open interest, followed by the 26,200 and 26,100 strikes, with the maximum Put writing at the 26,300, 26,200 and 26,250 strikes.

Meanwhile, the fear index, India VIX, has snapped five-week losing streak and rose 3.28 percent to 9.45 but remained near lower zones, signalling comfort zone for bulls and complacency among traders. At the same time, this also indicates the possibility of sharp market moves.

Corporate Action

Here are key corporate actions taking place next week: