Equities ended the week on a strong note, with the Nifty ending the session above the 10,650-mark on December 7
Exit polls, state election results as well as crude price movement are among 10 key things that the Street will be keeping an eye on.
Equities ended the week on a strong note even as investors awaited exit poll results from the five state elections. The 50-share index closed the session above the 10,650-mark on December 7.
Financials led the surge, backed by a huge jump in Kotak Mahindra Bank. Meanwhile, automobiles and consumption names were the big gainers, while the Nifty Midcap ended flat.
"Investors should stay cautious ahead of state elections' outcome, domestic and global macroeconomic data and crude oil price movement this week. The five state election results on December 11 will be crucial for general elections in 2019," Rahul Sharma, Senior Research Analyst at Equity99, said in a statement.
Here is a gist of 10 factors that could move the market this week.Election outcome
The much-anticipated election results in five states -- Rajasthan, Telangana, Madhya Pradesh, Chhattisgarh and Mizoram -- will be out on December 11. The Street will be keeping a close eye on these as it sets the tone for general elections in 2019. Majority of market participants want a stable ruling government rather than one having a fractured mandate.Exit polls
The Street will also react to the exit polls results that were announced minutes after voting concluded in Rajasthan and Telangana.Crude
The market will react to crude price movement after The Organisation of Petroleum Exporting Countries (OPEC) and Russia decided to decrease supply to the market. Reduced supply is likely to push up oil prices and that could be detrimental for the economy and market.
OPEC and its Russia-led allies agreed on December 7 to slash oil production by more than the market had expected despite pressure from US President Donald Trump to reduce the price of crude. The producer club will curb output from January by 0.8 million barrels per day versus October levels while non-OPEC allies will contribute an additional 0.4 million bpd of cuts, in a move to be reviewed at a meeting in April.Rupee
The currency will also play a key role for the market, especially in a scenario of fluctuating crude oil prices. The currency has appreciated to below 70 per dollar recently. It has traded in a narrow range of 70-71 per dollar, a strong appreciation from the 74 per dollar mark that it touched in October.Macro data
In India, investors will keep an eye on economic data such as consumer price inflation (CPI) and wholesale price inflation (WPI), which will be announced during the second half of next week. Cumulative industrial production and manufacturing output will also be watched out by the Street.Global cues
All eyes are on US-China trade truce, following the arrest of Huawei CFO. The US alleged that the company violated Iran sanctions as well. The CFO was arrested by Canada and the US has sought the CFO's extradition.
Additionally, the Street could also react to crude oil inventory data, inflation data in European nations as well as trade balance data for India as well.Technical factors
The Nifty formed a bearish candle on the weekly scale. The near term trend for the index is still positive, with the recent market weakness not damaging the positive trend, HDFC Securities said.
It expects an upside bounce in the Nifty this week. "The key resistance of 10,920-10,940 is going to be tested again in the next couple of weeks. Important weekly supports to be watched are 10,590-10,550 levels.”Corporate action
Investors will keep an eye on stocks such as BSE, Nestle and IDFC Bank, which are meeting to discuss interim dividend and interest payment. The boards of companies such as Manappuram Finance will be meeting to discuss a fundraising plan. Techno Electric & Engineering Company will be in focus as well on the back of a buyback discussion.Stocks in news
SBI: Shareholders approved issuing shares up to Rs 20,000 crore through various securities.
United Breweries: CFO Steven Bosch resigned.
IOC: The board will consider a share buyback on December 13.
Jet Airways: ICRA downgrades Jet Airways' long term ratings to 'C'
Bank of Baroda raises Rs 971 crore by issuing Basel III compliant bondsFII flowsAfter having purchased nearly Rs 5,000 crore in the equity segment, FIIs have been net sellers so far in this month. Investors will keep an eye on FII flows, especially in a scenario where the Federal Reserve has hinted at a slower pace of interest rate hikes.In December so far, FIIs have sold a little over Rs 800 crore, while domestic institutional investors have sold around Rs 3,000 crore worth of shares as well.
Assembly Elections 2018: Read the latest news, views and analysis here