Q4 results, macro data to guide markets

Encouraged by prediction of 80 per cent probability of a normal to above normal monsoon and dovish RBI statement, the markets closed on a positive note during the week ended. Gaining for the second consecutive week, the Sensex closed at 33,627, up by 658 points or 2 per cent while the Nifty closed at 10,331, up by 210 points or 2.1 per cent.

Mirroring the return of speculators in the broader markets; the mid- and small- cap indices have vaulted 4 per cent and 5.2 per cent to close at 16,597 and 17,883. The Goldilocks scenario that the RBI has outlined for the new fiscal — with higher growth expectations and lower inflationary forecasts — could very well indicate rates on hold for the whole year, say analysts.

Slowing inflation, accelerating growth and an economy that relies on domestic consumption may help cushion India from the trade war between the US and China.

US stocks tumbled on Friday as trade tensions between the US and China heated up. A full- blown trade war would have much more profound economic implications for both the countries. It would also drag down global trade and put vulnerable economies under pressure.

On Monday, the market may react to sharp fall in the US markets on Friday due to trade war tensions and weaker- than- expected US non- farm payroll data.

Near term trend will be dictated by Q4 results, macro data, developments over trade war, FII and DII activity, the movement of rupee and crude oil prices.

For the week ahead, chartists predict trading range of 33,000- 34,250 and 10,125- 10,500 for the indices.