The Union Budget will be the top factor for the markets this week while the ongoing corporate results and global cues will also impact sentiment. The Indian stock markets will be open for normal trading on February 1, which is a Saturday, when Finance Minister Nirmala Sitharaman presents the Union Budget to the Parliament.
The key event of the week would be the Budget and the expectations are high this time as market participants pin hopes for additional measures from the government to revive the economy. According to analysts, this is likely to drive momentum in the markets in the coming sessions. The broader market has rallied in expectation of re-rating of valuations and it may continue to do so till the actual Budget announcement.
On the earnings front, investors will react to ICICI Bank’s Q3 results on Monday. Around 400 companies will declare their quarterly earnings this week, which includes heavyweights like HDFC, Maruti Suzuki, SBI, ITC, HUL, IndiGo, and Tech Mahindra.
Meanwhile, the expiry of January series futures & options contracts is expected to inject further volatility in the markets. Traders will also track the impact of the coronavirus outbreak, which has killed 56 people in China and rattled investors globally.
Investors would also watch out for the US Fed and Bank of England’s monetary policy this week. The US Fed interest rate decision is scheduled for Thursday. Also, the United Kingdom is set to exit the European Union by next week’s January 31, 2020 deadline.
Shares slid on Monday as investors shunned equities on growing concerns over the scope of a China virus outbreak. US S&P 500 mini futures shed 1.2 per cent in early Asian trade. The Nikkei futures traded in Chicago suggested Japanese shares are on course for a steep 2 per cent decline. Even the SGX Nifty was trading with over 100 points cut, indicating a gap-down start for domestic indices today.
In commodities, oil prices slumped a further 2 per cent to multi-month lows on Monday as the rising number of cases of the new China virus deepened concerns about demand for crude. Brent crude fell by $1.12 a barrel to $59.57.
Back home, the Sensex closed 0.79 per cent lower last week while the Nifty ended with losses of 0.84 per cent.
Going forward, analysts say that the Nifty is witnessing strong support in the sub-12,200 zones. The market is likely to trade in range of 12,200 to 12,300 until 12,300 level is not breached and hence traders should try to buy at dips keeping close eye on 12,200 level. However, if the Nifty is able to breach level of 12300, it might lead to short covering move up to 12,350.
Source: Maalaimalar
