<p>Domestic equities are largely expected to witness stock specific action as the earnings season picks up pace with a host of key large and mid-cap companies releasing their numbers this week. Investors will also react to the results of index heavyweights like Reliance, Hindustan Unilever, ICICI Bank, and Kotak Bank that got released late last week.</p>.<p>In a truncated week, the market will take cues from global factors including Bank of Japan and European Central Bank meetings due on Monday and Thursday respectively. Among economic data releases, US manufacturing, gross domestic product and home sales data will be the key events to track.</p>.<p>Last week, Nifty witnessed profit booking on account of weak global cues and a muted start to earnings season. Nifty fell 272 points (-1.2%) to close at 2,1622 levels. Broader markets however ended on a mixed note with Midcap 100 up 0.6% while Smallcap100 was down 0.4%. Private banks, financials and metals were major losers while IT and PSU banks were among major gainers.</p>.<p>Private banking sector saw a sharp decline of 4.5% amid a heavy sell-off in HDFC Bank. The bank reported marginally weak results on account higher provisions on investments and lower net interest margings. The reaction received from investors was harsh as the post-results stock tanked ~12%. Smaller PSU banks on the other hand declared good set of numbers which led to 1.4% gain in the PSU bank index.</p>.<p>Overall October-December earnings season had a bumpy start with mix set of results. IT heavyweights have been the outliers as they reported marginally better-than-expected numbers and strong deal wins, while banking sector witnessed some moderation in growth and margins.</p>.<p>On the global front, hawkish commentary from the Federal Reserve, and strong retail sales data and weak initial jobless claims raised concerns around early rate cuts. US bond yields and the Dollar index surged highest in a month during the last week. Escalating tension in the Red Sea too led to a rise in oil prices amid disruption in demand-supply dynamics.</p>.<p>On the positive side, China is weighing more stimulus and is considering 1 trillion yuan ($139 billion) of new debt issuance under a special sovereign bond plan - which will be only the fourth such sale in the past 26 years to boost the economy.</p>.<p>Also World Economic Forum was held last week at Davos where India dominated with its presence, reinforcing its status as a resilient global economy and a preferred investment destination.</p>.<p>The nation saw huge investments for Maharashtra, Telangana and other states, thus reflecting that India is at an inflection point and is well placed to achieve its Rs 5 trillion goal.</p>.<p><em>(The writer is head – Retail Research, Motilal Oswal Financial Services Ltd)</em></p>
<p>Domestic equities are largely expected to witness stock specific action as the earnings season picks up pace with a host of key large and mid-cap companies releasing their numbers this week. Investors will also react to the results of index heavyweights like Reliance, Hindustan Unilever, ICICI Bank, and Kotak Bank that got released late last week.</p>.<p>In a truncated week, the market will take cues from global factors including Bank of Japan and European Central Bank meetings due on Monday and Thursday respectively. Among economic data releases, US manufacturing, gross domestic product and home sales data will be the key events to track.</p>.<p>Last week, Nifty witnessed profit booking on account of weak global cues and a muted start to earnings season. Nifty fell 272 points (-1.2%) to close at 2,1622 levels. Broader markets however ended on a mixed note with Midcap 100 up 0.6% while Smallcap100 was down 0.4%. Private banks, financials and metals were major losers while IT and PSU banks were among major gainers.</p>.<p>Private banking sector saw a sharp decline of 4.5% amid a heavy sell-off in HDFC Bank. The bank reported marginally weak results on account higher provisions on investments and lower net interest margings. The reaction received from investors was harsh as the post-results stock tanked ~12%. Smaller PSU banks on the other hand declared good set of numbers which led to 1.4% gain in the PSU bank index.</p>.<p>Overall October-December earnings season had a bumpy start with mix set of results. IT heavyweights have been the outliers as they reported marginally better-than-expected numbers and strong deal wins, while banking sector witnessed some moderation in growth and margins.</p>.<p>On the global front, hawkish commentary from the Federal Reserve, and strong retail sales data and weak initial jobless claims raised concerns around early rate cuts. US bond yields and the Dollar index surged highest in a month during the last week. Escalating tension in the Red Sea too led to a rise in oil prices amid disruption in demand-supply dynamics.</p>.<p>On the positive side, China is weighing more stimulus and is considering 1 trillion yuan ($139 billion) of new debt issuance under a special sovereign bond plan - which will be only the fourth such sale in the past 26 years to boost the economy.</p>.<p>Also World Economic Forum was held last week at Davos where India dominated with its presence, reinforcing its status as a resilient global economy and a preferred investment destination.</p>.<p>The nation saw huge investments for Maharashtra, Telangana and other states, thus reflecting that India is at an inflection point and is well placed to achieve its Rs 5 trillion goal.</p>.<p><em>(The writer is head – Retail Research, Motilal Oswal Financial Services Ltd)</em></p>