Key developments that will drive the markets this week

Let us look at all important news that could impact market sentiment in the week ahead.

Jan 04, 2021 07:01 IST India Infoline News Service

Sensex and Nifty began the new year 2021 with bang. On Friday, Sensex ended 117 points higher at 47,868 and Nifty closed 36 points higher at 14,018. During the session, Sensex hit a lifetime high of high of 47,980 and Nifty rose to a new high of 14,049. Let us look at all important news that could likely impact market sentiment in the week ahead.

Q3FY21 results

Top software exporter Tata Consultancy Earnings (TCS) is set to unveil its December quarter earnings on January 8, and will kick start the earnings season. GM Breweries, Indian Acrylics, Uttam Sugar Mills, Alpha Hi-Tech Fuel, Integrated Capital Services, Radix Industries, Shalby, Tata Consultancy Services, CHD Chemicals, Avenue Supermarts and Bhansali Engineering Polymers will declare their quarterly earnings in later part of the coming week.

FII buying

FIIs were net buyers in the equity segment last week, with gross purchases of Rs24,099.89cr and gross sales of Rs 18,110.96cr, leading to a net inflow of Rs5,988.93cr. India continued to see strong FII inflow in December at Rs 53,499.66 crore, the second highest monthly inflow after November which had witnessed the highest monthly FII investment in equities at Rs 70,844.63, taking the total inflow to over Rs 1.66 lakh crore in 2020, the year gone by.

COVID Developments

Globally there were more than 8.41crore confirmed infections so far, with over 18.3 lakh deaths as per Johns Hopkins University. United States with 2 crore cases and 3.46 lakh deaths and Europe & UK remained most impacted regions by the COVID-19. The COVID-19 death toll in the United States has surpassed 350,000 as experts anticipate another surge in coronavirus cases and deaths stemming from holiday gatherings over Christmas and New Year's. Data compiled by Johns Hopkins University shows the U.S. passed the threshold early Sunday morning.

Closer home, India on Sunday recorded 18,177 fresh cases of coronavirus in a span of 24 hours, taking the total number of positive cases in the country to 1,03,23,965, according to the health update by the Union Ministry of Health and Family Welfare. With this, the total number of active cases in the country now stands at 2,47,220. Meanwhile, India has successfully cultured the new coronavirus strain, which originated in the UK, the Indian Council of Medical Research (ICMR) said on Saturday.

Vaccination drive

The DCGI in its presser on Sunday gave nod to the “emergency restricted” approval for two vaccine candidates in India, Bharat Biotech’s Covaxin and Oxford-Astrazeneca’s Covishield. The drug controller said that it is paying close attention to the increasing cases of UK’s Covid-19 new strain in the country and was prioritizing its threat while conducting clinical trials.

A dry run to check the best way to administer Covid-19 vaccine and plug loopholes in logistics and training was held across all states on 2nd January. Union Health Minister Harsh Vardhan reviewed the process in GTB Hospital in Delhi and said the government would not compromise on any protocol before approving a vaccine for the novel coronavirus. He appealed to people not to be misguided by rumours regarding the safety and efficacy of vaccines.

Macroeconomic data

In India, Markit Manufacturing PMI for December will be released on Monday and Markit Services PMI data for December on Wednesday, while the foreign exchange reserves for the week ended January 1 will be released on Friday. On the global front, investors will keep an eye out for the slew of data releases from the United States. It will begin with Markit Manufacturing PMI on January 4, followed by Redbook on January 5, Markit Composite PMI, Factory Orders on January 6, Balance of Trade, Jobless Claims, Import & Export on January 7 and Wholesale Inventories and Baker Hughes Oil Rig Count on January 8.

US stocks

US stocks ended 2020 at a record high on Thursday. For the year, the S&P 500 is up more than 15%, the Dow more than 6% and the Nasdaq about 43%, which would mark the biggest yearly gain for the tech-heavy index since 2009. The Dow Jones Industrial Average rose 196.92 points, or 0.65%, to 30,606.48, while the S&P 500 gained 24.03 points, or 0.64%, to 3,756.07 and the Nasdaq Composite added 18.28 points, or 0.14%, to 12,888.28.

On Thursday, the Labor Department’s final weekly unemployment claims report for 2020 showed another 787,000 Americans filed for first-time jobless claims, for a sum well above the pre-pandemic weekly average of 200,000 new claims, but still the lowest level in a month. US markets were shut on Friday for New Year’s Day.

Georgia elections

The two Georgia runoff elections on 5th January will be key event to watch out for as that will decide which party (Democratic or Republican) will get control of US Senate. Democrats need to win both races to control the upper house of Congress while Republicans need to win just one.

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