Key developments that will drive the markets this week

Let us look at the key developments this week.

December 06, 2021 7:38 IST | India Infoline News Service
Domestic markets in the last week managed to end with modest gains amid mixed cues however excessive volatility across the board kept the participants on their toes. After the weak start, favourable GDP numbers boosted sentiment in the middle however the updates on the new COVID variant capped the upside and triggered a sell-off on the final day. Finally, Nifty ended at 17,196;70; up by 1%.

Investors will be closely eyeing the monetary policy review to meet the outcome on Dec 8. It’s going to be tough for the MPC to balance things amid the risk of the new COVID variant and hawkish stance of the US Fed. On the macroeconomic front, IIP number and CPI inflation are scheduled for Dec 10.

Let us look at the key developments this week.

RBI Policy & Macroeconomic data to watch out

The MPC of the Reserve Bank of India (RBI) is scheduled to meet between December 6-8. The RBI is due to release its statement on Wednesday. Official data for IIP number and CPI inflation are scheduled for Dec 10

On the global front, Europe - Bank of England Deputy Governor Monetary Policy Ben Broadbent is due to speak on Monday, December 6.

Asia - Data on trade in China is due on Tuesday, and inflation on Thursday. Japan's quarterly GDP numbers are due on Wednesday.

United States - US inflation data is due on Friday.

IPO buzz

RateGain Travel Technologies, Shriram Properties, CE Info Systems (MapmyIndia) and a Rakesh Jhunjhunwala-backed company Metro Brands will hit the primary markets this week.

FII & DII flow

Foreign institutional investors (FII) net sold Indian equities worth Rs17,418.1cr ($1.7 billion).

Coronavirus cases in India

India, on Sunday, registered 8,895 new Covid cases and 2,796 deaths in the last 24 hours. The highest number of daily deaths were reported in Bihar with 2,426 fatalities. Total Covid-19 caseload has reached 3,46,33,255, the death toll due to the virus now stands at 4,73,326.

Meanwhile, on Sunday, India's tally of Omicron variant cases increased to 21 after Delhi and Rajasthan reported their first cases and Maharashtra added seven more cases of the new variant.

Technical view

The Nifty index outperformed the Bank Nifty index by ~0.6% with both the indices closing ~1.2%/0.6% higher, on account of a short-covering. However, as the indices continue to trade in a lower top lower bottom chart structure, we expect the indices to witness a selling pressure at the higher levels.

Gold & Silver outlook

MCX Gold remained volatile during the week. On the daily chart, the price has fallen below 20EMA. However, the 20EMA and 50EMA are in the bullish crossover. Momentum indicator, RSI on the daily timeframe is in the bullish crossover.

MCX Silver price corrected during the last week. The price has remained below the 20-day exponential moving average. The 20EMA and 50EMA are in the bearish crossover.

US market ended mixed on Friday

US markets on Friday ended the session on a mixed note with Dow Jones closed 53 points down while Nasdaq seeing massive profit booking to close lower by over 290 points. Bond yields closed near 1.34% the lowest in over 3 months while the US$ index close almost unchanged at 96.10.

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