Trigger for the Week | How will it impact? |
Ø Global COVID-19 numbers continue to soar relentlessly | Ø The afflictions have crossed 3.5 million, casualties at 2.5 lakhs so recovery could be slow and grinding
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Ø US threat to impose penal tariffs on China could be an overhang | Ø Trump’s threat to re-impose tariffs endangers the trade deal and is likely to push economies into slowdown
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Ø SGX Nifty was 6% lower on Friday when Indian markets were shut | Ø Nifty could open gap down by over 500 points on global tariff war fears. Nifty gained 15% in April 2020
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Ø Market will be expecting the second economic package this week | Ø Package is likely to be aimed at SMEs and MSMEs to tide over the COVID disruption but budget could be limited
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Ø Gilead getting emergency clearance will be positive for global markets | Ø This enables rapid distribution to COVID-19 patients in the US; which remains the worst affected globally
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Ø Reliance could react to the rights issue in the coming week | Ø The 1:15 rights issue will be a positive for debt reduction and will be seen positively by the markets
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Ø FPIs reported a positive week after a long gap | Ø FPIs net buying Rs.1652 crore may not be substantive but it underlines that risk-off maybe shifting to risk-on
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Ø While earnings have been tepid, focus will be on the mid caps | Ø Apart from big guns like ICICI Bank and HCL Tech, others like Adani SEZ, SBI Life and Yes Bank results are due
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Ø The sharp appreciation in the INR could be positive for markets | Ø The INR gained nearly 180 points during the week and that confidence could be positive for FPI flows
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Ø Oil remains tentative round $25/bbl but supply could be the key | Ø The markets will focus on oil prices holding above $25/bbl to sustain oil stock prices in the market
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Ø Weak core sector and zero auto sales will weigh on markets | Ø These numbers were along expected lines but they will weigh negatively on capital goods and infra sector
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Ø This week will see the PMI services and PMI manufacturing numbers | Ø While PMI < 50 is inevitable, markets will be keen to ensure it does not dip too deep below the 50 levels
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Ø Global cues from across the world could hold the key to sentiments | Ø Key US data points like factory data, balance of trade and jobless claims will drive markets this week
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Ø Technically, the Nifty 10,000 levels will be critical for future traction | Ø The Nifty needs to settle above 10,000 to sustain upsides and this week could be critical for these levels
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