Key developments that will drive the markets this week

Let us look at the key developments this week.

November 29, 2021 7:16 IST | India Infoline News Service
Indian stock markets saw the worst ending on Friday since August and lost over 4%, pressurized by weak global cues. The bias was negative from the beginning amid the inflation fear and the situation worsened on the final day as the benchmark slipped nearly 4% in reaction to the news of the new COVID variant. Consequently, the Nifty index ended around the week’s low to close at 17,026.45 levels. Most of the sectoral indices witnessed a fall in line with the benchmark and the broader indices too ended lower.

For this week, market participants will be eyeing important macroeconomic data and domestic events. To start with, GDP and core sector data are scheduled for November 30. As the week marks the beginning of the new month also, auto sales will also start pouring in from December 1. Besides, we have Markit Manufacturing and Services PMI data scheduled on December 1 and December 3 respectively. The beginning of the winter session of the parliament will be in focus with 26 bills to be tabled including the Cryptocurrency bill. Apart from the domestic factors, markets will continue to take cues from the global markets especially the updates on the new COVID variant.

Let us look at the key developments this week.

Star Health and Allied Insurance Company & Tega Industries IPO to hit D-Street

Rakesh Jhunjhunwala-backed Star Health and Allied Insurance Company IPO worth Rs7,074crore will be available for bidding between November 30 and December 2. It has set the price band for its initial public offer (IPO) at Rs870-900 per share and this would be the third-largest IPO in 2021.

Tega Industries, a manufacturer of consumables for the mining industry, will open on December 1 and close on December 3. The price band for this IPO has been fixed at Rs443-453 a share.

With this, Go Fashion shares is likely to be listed on stock exchanges on November 30.

GDP, core sector data and other macro data to watch out

India's GDP will be released after market hours on Tuesday and also eight core sector data will be released on the same day. A private survey on PMI manufacturing is due for release on December 1. A separate survey, on services activity (PMI Service), will be out on December 3.

The winter session of the parliament will start from today and it will be in focus as 26 bills, including the cryptocurrency bill, will be tabled.

Auto sales data in focus 

Automobile makers will start to report their monthly sales i.e. for the month of November will release data on December 1.

Coronavirus cases in India

India records 8,774 new coronavirus cases, active cases at 1.05 lakh. Meanwhile, reports of a new Covid variant, named 'Omicron' by the WHO and declared as a variant of concern, which was first detected in South Africa, has triggered concerns across the world, with several countries imposing travel bans on multiple southern African nations.

Maharashtra CM Uddhav Thackeray on Sunday said that in order to avoid another coronavirus-induced lockdown in the state, people must follow Covid-appropriate behaviour, and ask the authorities to take necessary steps to protect citizens from the new Omicron variant of the virus without waiting for the Centre's directives.

FII & DII updates

In the last week, foreign institutional investors (FII) net sold Indian equities worth Rs12,650.6cr ($1.7 billion), after making net purchases of Rs18,745.2 crore ($2.5 billion) in the previous week.

Gold & Silver Outlook

MCX Gold slipped sharply after consolidation on the daily timeframe suggesting a rise in bearish bet. On the daily chart, the price has fallen below 20EMA as well as 50EMA. On the lower end, immediate support is visible at 46500, below which price may correct towards 45000. On the higher end resistance is visible at 48500/50000.

MCX Silver price corrected sharply during the last few days. The price has fallen below the 20-day exponential moving average. The 20EMA and 50EMA are in the bullish crossover. Support is seen at 64000/62500 whereas resistance is visible at 67000/68500.

Technical view

Markets witnessed a big selloff during the closing part of the week, to close in the red as across the board short-selling weighed in. The index Option gamma writers ran for a cover as the indices witnessed a sharp delta move.  On the weekly charts, the Nifty is has given a bearish head & shoulder breakdown, indicating a continued downward momentum.

U.S. stocks end lower on Friday

US markets witnessed heavy selling pressure on Friday as intensifying concerns with of spread of deadly Omicron to various countries and resultant restrictions imposed by several countries dented sentiments. All three key indices in the USA recorded a 2.2-2.5% sharp correction last Friday marking it as the worst black Friday since 1950. 10-Year USA treasury yield fell sharply to 1.48% from 1.64% in two days suggesting investors turning risk average due to fear of the virus. For the week, investors will be continuously watching out for the progress of the spread of Omicron and the effectiveness of existing vaccines against this virus. However, November job data and ISM manufacturing data will also be in focus in the USA. Additionally, Fed chairman Powell’s testimony before the banking senate on Tuesday and OPEC plus meeting on Thursday will also be in focus for the week.

Global data to watch out for this week

United States: Federal Reserve Chairman Jerome Powell is due to speak on Tuesday, November 30. Speeches by other US central bank officials are also slated for this week. Data on employment in the world's largest economy is due on Friday.

Asian: A private survey on manufacturing in China is due for release on November 30.

Data on retail sales in Japan are due on November 29. Data on unemployment, industrial production and housing in the country are due the next day.

Europe: Surveys on manufacturing and services in the UK are due to be out on Tuesday. Bank of England (BoE) Member Michael Saunders is due to speak on Friday.

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