Equity benchmarks had a dismal last week, with Sensex and Nifty shedding over a percent
The start of earnings season, GST Council meet and crude price movements are among the 10 factors that will dominate the market this week.
On the earnings front, IT majors TCS and Infosys will be announcing their numbers on January 10 and January 11, respectively. Apart from them, the likes of Bajaj Corp, Bandhan Bank, IndusInd Bank and Kotak Mahindra Bank will also be declaring December quarter results.
Equity benchmarks had a dismal week, with the Sensex and Nifty shedding over a percent. There was some recovery among banks, but the overall trend was negative.
"Investors should stay cautious as Q3 earnings season kicks off this week. On the domestic front, markets will also look forward to the industrial production data for November. US and China's inflation data will be watched on the global front," Rahul Sharma, Senior Research Analyst at Equity99 said in a statement.
Here’s a list of all events that could have an impact on the market this week.Q3 earnings season gets underway
The week will witness start of the earnings season, with around 12 BSE companies declaring their December quarter results. These include: Bajaj Corp, Bandhan Bank, IndusInd Bank and Kotak Mahindra Bank. Analyst remain sceptical of earnings, though there could be some hope of a better performance. They believe the next leg of the rally for markets could come from strong earnings growth.TCS and Infosys Q3 results
Tata Consultancy Services (TCS) and Infosys will announce their results for the December quarter. TCS will announce its Q3 numbers on January 10.TCS informed exchanges that the Board will meet on that day to:
(i) Approve and take on record the audited financial results of the company under Indian Accounting Standards (Ind AS) for the quarter and nine months ending December 31, 201 8;
(ii) Approve and take on record the audited consolidated financial results of the company and its subsidiaries under Ind-AS for the quarter and nine months ending December 31, 2018
(iii) Consider declaration of a third interim dividend to the equity shareholders.
Following TCS, Infosys will announce its results on January 11. The numbers will be declared around 4:15 pm IST. Following this, a common press conference is scheduled at 4:45 pm IST.
The company reported 13.8 percent sequential growth in Q2 consolidated profit at Rs 4,110 crore, while consolidated revenue grew 7.7 percent to Rs 20,609 crore.US-China trade talks
Investors will keep an eye on trade talks between US and China. Representatives of both nations will hold a meeting on January 7-8 in Beijing.
China has initiated these dates for new round of talks with the US. A US-China trade war has spooked markets across the globe and raised concerns of an economic slowdown in both nations.GST Council meet
After announcing cuts in its previous meeting, the Goods and Services Tax (GST) Council will meet on January 10. According to reports, the council will take up GST rates on under-construction flats and houses along with hiking exemption threshold for SMEs.
The government could cut rates to boost consumption spending. Having said that, investors could take note of this development in the context of falling GST collections.Crude
The market will keep an eye on the movement of Brent crude, which has been slowly-but-steadily rising after its recent 30 percent drop. The commodity traded above $57 per barrel, which does not bode well for nations such as India. Oil imports form a huge part of India’s import bill and rising prices mean an impact on India’s macros.
Brent crude and US crude have risen on hopes of some breakthrough between US and China, which meet early this week. “We are seeing a short term bottom near $50 a barrel in Brent oil. A further move is seen above $55.40 per barrel towards its next level of resistance near $58.20-62. Further bullishness is seen over an OPEC production cut and drops in US crude inventory other than a drop in Canada rig count,” Abhishek Bansal, Chairman of ABans Group of Companies, said in a statement.Macro data
Back home, investors will keep an eye on some macro data points such as forex reserves, Index of Industrial Production (IIP), manufacturing output, among others.
In the US, ISM data for non-manufacturing business activity will be announced. Along with it, the US Federal Reserve will release minutes of the Federal Open Markets Committee (FOMC) meeting as well.Corporate action
Apart from results, companies such as Syndicate Bank, NMDC and Tata Investment Corporation are likely to be in the news for corporate action.
The board of Syndicate Bank will meet to discuss its fundraising plan and NMDC and Tata Investment will also be meeting to discuss a buyback.Technical factors
The Nifty formed a Bearish Engulfing pattern on the weekly scale last week, slipping 1.2 percent. Experts said formation of a bearish candle on the weekly scale suggests multiple barriers at higher zones.
Analysts at HDFC Securities believe that the near term trend for the Nifty is choppy with a weak bias. “With the formation of an upside reversal pattern on the daily timeframe chart, there is possibility of a minor upside bounce in the Nifty in early to mid-part of this week. The upside area of 10,900-10,950 is expected to be a tough hurdle for the market on any rise and there is a possibility of selling pressure at the highs,” they wrote in their report.Rupee
Traders will keep an eye on the movement of the rupee, which has seen mixed trends during the week that passed. Though the currency recovered during the latter part of the week, possibility of higher crude and dollar strengthening could cap the upside, analysts said.
The rupee rebounded 48 paise on January 4 to settle at 69.72 against the dollar, in line with smart gains in domestic equities and uptrend in other emerging market currencies.
Also, sustained selling of the American currency by exporters and banks propped up the rupee after two successive sessions of fall, traders said.Stocks in NewsReliance Home Finance has completed repayment of interest on non-convertible debentures of Rs 273 crore.
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