Global cues to dictate market trends
Winter session washout has increased fears of delay in GST rollout.
Disheartened by complete washout of winter session, US Fed’s hawkish rate outlook, weak economic numbers and continued concerns over impact of demonetisation, the markets witnessed selling again during the week ended.
Benchmark indices, the Sensex and the Nifty closed 257 points and 123 points lower at 26,490 and 8,139.
Winter session washout has increased fears of delay in GST rollout. FM’s latest statement suggests rollout of new tax regime between April and September.
Firm trends in international crude oil prices may ignite inflation again due to rise in domestic fuel rates. Analysts expect market slowdown to continue till the start of Q3 earnings season.
Demonetisation may hit growth for a few quarters but if it makes India’s tax to GDP ratio grow by around 50 bps because of the deposits that have come in the formal economy, it will be major positive for the economy.
Near term direction of markets will be dictated by global cues, attitude of FIIs ahead of year end vacation, international crude oil trends, movement of rupee against dollar and steps of Centre over the ongoing drive against black money.
For the week ahead, chartists predict trading range of 26000-27000 and 7975-8300 for the benchmark indices. Support for the indices evident at 26225 & 26000 and 8050 & 7975. Broad consolidation can be seen in the markets.