Market forecast - What to expect this week?

5 Dec 2022 , 12:26 PM

Indian equity markets are expecting that the RBI will go slow on its interest rate hikes. RBI will announce interest rate hike this week, on December 6th. If markets’ expectations are met, and RBI slows down on interest rate hike, then it may turn out to be a good weak for equity markets. If the central bank does not moderate its hawkish stand on inflation, and does not reduce the quantum of its interest rate hike, markets will see sharp decline.

On the global front, inflation in Euro zone came down to 10%, in November.  Manufacturing Purchasing Managers’ Index of China came down to 48 in November. A reading of less than 50 means manufacturing activity contracted in the month. This contraction happened once again because of draconian Covid lockdowns. Sales figures for Black Friday indicate a reasonably good level of shopping by US consumers. Black Friday is the biggest shopping day in the year in United States. It also marks the start of Christmas shopping season. Visits to physical retailers during Black Friday increased y-o-y by 17.3%. Consumption makes up the biggest pie of US GDP. A good Black Friday and Christmas shopping season give hope of picking up of consumption in the US economy.