Market outlook: Covid situation, macro data to influence stock market this week

Market


In the first week of 2023, the domestic equity market will get influenced by macroeconomic data announcements, the Covid situation in China, and global trends. Besides, the Indian stock market would also keep track of the rupee movement, Brent crude oil prices, and foreign fund investment trends.

India’s Purchasing Managers’ Index (PMI) data for the manufacturing sector is to be announced on Monday and the service sector will be out on Wednesday.

“The coming week marks the beginning of the new calendar year 2023 and participants will look forward to important data viz. auto sales, S&P Global India Manufacturing PMI data, and S&P Global India Services PMI data during the week. Besides, global cues will continue to keep the volatility high,” Ajit Mishra, VP – of Technical Research, Religare Broking Ltd said.

Mishra added that Nifty has multiple hurdles to cross till 18,500 so participants should continue with a stock- specific approach. “We are seeing certain themes and sectors like fertilisers, sugar, banking, metal, and energy showing resilience while defensive viz. FMCG and pharma may continue to trade lackluster so plan your positions accordingly,” he said.

Vinod Nair, Head of Research at Geojit Financial Services said, “The ongoing volatility is expected to be sustained in the near term because of high-interest rates and a slowing economy. We believe that value buying is the theme of 2023, with a focus on domestically oriented sectors and buying on dips. Fair valuation, steady earnings, and a robust demand scenario will be the cutting parameters.”

Other significant data points that will be released this week are- the US will publish its November 2022 export and import data, as well as its trade balance figures.

As market players attempt to understand the Fed’s stance, Indian markets may respond in lockstep with their international counterparts when the FOMC minutes are made public later this week, Apurva Sheth, Head of Market Perspectives, Samco Securities said.

“Investors should organise their portfolios correctly during volatile periods and focus on the long view rather than the immediate problems,” Sheth added.

The 30-share BSE Sensex climbed 2,586.92 points or 4.44 per cent last year. The benchmark touched its all-time high of 63,583.07 points on December 1 last year after hitting its 52-week low of 50,921.22 on June 17


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