Weekly Triggers Jan 18

weekly 4 Weekly Triggers Jan 18

Trigger for the WeekHow will it impact?
·         Nifty held 14,400 and Sensex 49,000 after Friday’s correction·         Options data hints at Nifty range of 14,000 to 14,600 with likelihood of pre-budget VIX scaling 30 levels
·         Lower than expected inflation hints at RBI continuing accommodation·         CPI inflation at a multi-quarter low of 4.59% was almost 70-80 bps lower than the street expectations
·         Higher trade deficit could be a worry but good news for IIP·         The sharp rise in non-oil imports in Dec-20 could hint at a likely pick-up in IIP growth in coming months
·         Banks are likely to react positively to HDFC Bank Q3 results·         Since it was announced on Saturday, banks are likely to react favorably to growth and asset quality positives
·         Markets will keep an eye on rising bond yields at the short end·         Rise in US bond yields and the RBI reverse repos have hardened yields in the short end, raising cost of funds
·         Market volatility likely to increase as budget expectations build up·         Markets will look for budget clues on fiscal deficit, spending, personal taxes, indirect taxes etc
·         Over 190 companies expected to announce results in the week·         Big results names include Bajaj Finance, Bajaj Auto, L&T, Asian Paints, SBI Life, HDFC Life, SBI Cards & Ultratech
·         Look out for the Big Reliance results on 22 Jan for ARPUs and GRMs·         Markets are expecting RIL to set the tone with higher GRMs, better ARPUs and also better petchem margins
·         The COVID risk will depend on the roll out of the vaccination scheme·         India is likely to inoculate 3 crore people in first round and its success will be the key to market risk
·         Markets will also look to the two big IPOs response in the coming week·         IRFC and Indigo Paints will look to raise around Rs.5,800 crore between them  and the appetite will be critical
·         FPI flows continued and have seen infusion of Rs.17,000 crore in Jan·         The continued enthusiasm is good news and the week could see some aggressive pre-budget buying by FIIs
·         Joe Biden takes over as the US President on 20-Jan·         While the $1.9 trillion stimulus is known, markets will look for cues on COVID battle and China stand
·         Key Asian data points could also influence markets during the week·         Asian data points include Japan IIP, BOJ meet, Japan PMI, China IIP and China retail sales and GDP numbers
·         Major US and European data points could also influence markets·         Data points include US jobless claims, PMI, home sales, EU inflation, ECB rates decision and EU PMI numbers

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