stock market triggers: Nifty down 1,000 points from peak. Top 10 triggers to track this week

Since its December 1 record high of 18,887.60 points, Nifty has now lost over 1,000 points or 5.5% in a little more than a month’s time.

Ahead of the Union Budget on February 1, the market is expected to maintain a cautious stance.

The stock market trend has started to be impacted by the view and in anticipation of the heavy economic data, Fed policy, India Q3 results and Union Budget expectations, said Vinod Nair, Head of Research at .

Here are 10 triggers that may sway the market during the week:

Q3 earnings
With or declaring its December quarter results in post-market hours on Monday, the Q3 result season would officially begin from this week. During the rest of the week, , , and would also be declaring their numbers.

The attrition rates of IT companies will be closely looked out after they reached the peaks in Q2. Stock specific movements will be prominent and as investors react to earnings misses and beats, they are advised to assess the company’s long-term potential rather than basing their investment decisions solely on quarterly performance, said Apurva Sheth, Head of Market Perspectives, Samco Securities.

Macro data
Investors would be closely tracking inflation numbers of US and China which are scheduled to release during the week. Analysts said with the Fed still maintaining its hawkish tone, the US inflation numbers will be highly significant.

“Globally, the phenomenon of good economic news becoming bad news for markets might continue in the near term. The latest data from the US show increasing job creation and declining jobless claims,” said VK Vijayakumar of Geojit Financial Services.

Back home, India’s IIP and CPI Inflation data will be unveiled on January 12.

New listing
While the mainboard IPO calendar looks empty for the week, Sah Polymers is likely to list on January 12. The Rs 66 crore IPO of the Udaipur-based company which sells PP fabric-related products was subscribed over 17 times last week.

Lock-in period expiry
Driving stock-specific action would be the expiry of shareholder lock-ins in recent debutant Electronics Mart whose 3.3% equity would be unlocked for trading on Jan 10.

Corporate action

‘s rights issue is scheduled to open on Jan9 while ‘ board will meet on Jan 10 to consider fund raising. On Jan 11, IEX’s buyback through the open market will begin.

Technical factors
On the weekly charts, Nifty has formed a long bear candle. Analysts said a decisive break below 17,800 in Nifty and 41,500 in the banking index would further add to the pressure. “On the downside, the 17,450 zone would act as crucial support for Nifty. Meanwhile, volatility would remain high across sectors with the beginning of the earnings season. Keeping in mind the scenario, we recommend preferring a hedged approach and avoid overtrading,” said Ajit Mishra of

Broking.

FII flow
NSDL data shows that FIIs have sold Indian equities worth Rs 5,872 crore last week. “The money taken out is being invested in the underperformers of last year like China and Europe, which are doing well now. FIIs will sell stocks in which they are sitting on profits, like the banking segment,” Vijayakumar said.

Oil prices
Amid worries related to global recession, crude oil prices ended the week lower by 8%. Brent futures settled the week at $78.57 a barrel. “Since the Saudis are already slashing prices, we could hear a steady chorus of demand destruction concerns if China’s Covid situation worsens,” said Edward Moya, market analyst at OANDA.

Rupee Moves
On a weekly basis, the Indian rupee ended largely unchanged at 82.72 per dollar. The currency market dialed back expectations that the Fed might raise rates by 50 basis points in February, and this pushed the dollar index, which measures the greenback against six counterparts, down 1.2% to 103.90, according to reports..

Global markets
After the US jobs report showed wage growth slowed in December, fuelling investor bets that inflation is easing and that the Federal Reserve need not be as aggressive as some feared, the S&P 500 jumped 2.3%, the Dow Jones climbed 2.1% and the Nasdaq surged 2.6% on Friday.

Britain’s FTSE 100 index hit a more than three-year high on Friday while the Nikkei rose 0.59% on Friday but ended the week lower by 0.46%.


(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)