ITC Demerger, China CPI And US Job Data: The Week Ahead
The upcoming week promises a blend of key domestic and global events set to shape market sentiment. In India, all eyes will be on the first advance GDP estimate for fiscal 2025, along with November's industrial production data, both offering insights into the economy's growth trajectory.
Meanwhile, ITC Ltd. will remain in focus, as its hospitality arm begins a new chapter with its demerger taking effect. Investor interest will also be drawn to three mainboard IPOs opening this week, adding to the primary market buzz.
On the global front, the week will witness significant developments, including China's inflation data, Japan's household spending figures, and the US Supreme Court hearing on the TikTok ban.
Additionally, Wall Street will pause on Thursday to mark the state funeral of former US President Jimmy Carter.
Markets Last Week
The Nifty 50 and Sensex ended the week higher, gaining 1.5% and 1.4%, respectively, despite snapping a two-day winning streak on Friday. Nifty PSU Banks and Nifty Media indices broke their three-week losing streaks, while Nifty Oil and Gas, Nifty Energy, and Nifty Auto extended gains for the second consecutive week.
Nifty Pharma marked its third straight week of advance, while Nifty Metal rebounded after two weeks of loss. On the downside, Nifty Bank and Nifty IT ended their two-week winning streaks.
Among stocks, Oil and Natural Gas Corp., Maruti Suzuki India Ltd., and Eicher Motors Ltd. emerged as the top gainers on the Nifty. Broader markets also performed well, with Nifty Midcap 150 rising 1.25% and Nifty Smallcap 250 gaining 1.2% for the week.
Domestic Cues
India's first advance GDP estimate for fiscal 2025, due on Tuesday, Jan. 7, is expected to fall short of the Reserve Bank of India's projection, likely fuelling calls for a rate cut in February. Growth is projected to slow to 6.3%, below the RBI's revised 6.6% estimate. Achieving this would require a rebound in the second half, supported by improved farm output, corporate capex, and pre-election government spending. However, tight monetary policy continues to weigh on housing, credit, and private investments.
On Friday, Jan. 10, industrial production data for November is expected to show growth slowing to 1.3% from 3.5% in October, amid weaker exports and high interest rates dampening demand. Core sector output contracted by 3.3% month-on-month, while non-oil exports fell 17.9%. The manufacturing PMI dipped to 56.5, and GST collections for December declined by 3%.
Stronger government spending, rural consumption recovery, and potential RBI policy easing in February are expected to support industrial activity in the coming months.
Global Cues
On Monday, Jan. 6, inflation data from Thailand and Germany, will be released, while the US will release S&P Global services and composite PMI data.
Tuesday, Jan. 7 will see CPI releases from the Philippines, France, Italy, and the Netherlands, along with US job openings data, offering insights on the labour market.
Australia's CPI data is due on Wednesday, Jan. 8, alongside the release of the Federal Reserve's December meeting minutes, which may clarify the central bank's stance on rate cuts. Samsung is also set to report earnings.
Thursday, Jan. 9, brings China's CPI and PPI data, while the US observes a federal holiday for the state funeral of former President Jimmy Carter, with President Joe Biden expected to deliver a eulogy. Seven & i Holdings, parent of 7-Eleven, will announce its earnings.
On Friday, Jan. 10, Brazil's CPI, Canada's unemployment figures, and Japan's household spending data will be in focus. Additionally, the US Supreme Court will hear a significant case concerning the TikTok ban, set to take effect on Jan. 19.
Primary Market Action
There are three mainboard offerings during the week and seven SME IPOs.
Corporate Actions Ahead
ITC Hotels Ltd. will be demerged from ITC Ltd., with the record date for the company for demerger and the ex-date for the shares of ITC set at Jan. 6.
Here are the other major corporate actions to look out for during the week:
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