Macro data vital for Dalal Street

Investors will also keep an eye on auto sales figures

Markets finished higher for a second week with BSE Sensex reclaiming the 26,000-mark. Participants remain optimistic that the much sought after goods and services tax (GST) Bill will get through during the current winter session of Parliament, after the government decided to negotiate with the opposition and reach a consensus. In this truncated week, rupee depreciated nearly one per cent — from 66.09 on November 20 to 66.75 on November 27 against the US dollar, as the prospects of the US Fed interest rate hike strengthened the dollar.

The Sensex climbed 260 points, or one per cent, to finish at 26,128 while the Nifty gained 86 points, or one per cent, to end at 7,943 for the week, its the highest closing levels since November 6.

“Nifty 50 mildly rebounded this week and is on the recovery path. Still, the rebound is not convincing and will face stiff resistance at the 8,000-8,100 level. The downward momentum in the short term has subsided for the time being, but the medium term trend still looks down. It is expected that Nifty 50 will test its resistance area of 8,100 this week before any meaningful rally to sustain. The market is to remain mildly bullish and will test its key resistance area of 8,100 for the week ahead,” according to Jimeet Modi, CEO, SAMCO Securities.

Healthy rollovers in the derivatives segment for the near-month November to December contracts on Thursday further accelerated the rally. Rollovers in Nifty index futures contracts were at 66 per cent level, higher than the three-month average of 62 per cent, and market-wide rollovers at 82 per cent were also slightly above the three-month average.

Another significant event that marked November 26, was the beginning of Parliament winter session. In the ongoing session, government has held out an olive branch to the Opposition for the passage of the GST bill.

Stocks in focus
Hero MotoCorp surged 5.5 per cent and emerged as the top gainer for the week after Bain Capital offloaded 2.75 million shares of the company at Rs 2,591.25 per share in a bulk deal on the NSE, while Morgan Stanley Asia (Singapore) purchased 1.69 million shares of Hero MotoCorp at Rs 2,590 per share on the NSE.

Another stellar performer was Tata Motors. The stock advanced 3.65 per cent, after Jaguar Land Rover (JLR) decided to spend £450 million to double the size of its engine manufacturing centre in the UK.

On the flip side, Dr Reddy's Laboratories tanked 7.5 per cent after the US Food and Drug Administration announced it may withhold approval of any new applications for drugs manufactured by the company, unless and until its three units comply to current good manufacturing practice.

The week next
The Reserve Bank of India (RBI)'s fifth bi-monthly monetary policy will be declared on  Tuesday. However, most economists and analysts expect it to be a non-event. Key macroeconomic data will be unveiled during the week. India's gross domestic product (GDP) data for Q2 September on Monday, manufacturing purchasing managers' index (PMI) data for November on Tuesday, and services PMI data for the current month on Thursday.

Further, investors will closely monitor the monthly sales figures of automobile companies, starting Tuesday.

The movement in China markets is set to dictate the trend on the bourses after the shares cracked six per cent on Friday, as the regulator banned some brokerages for infringement of trading rules. Meanwhile, China manufacturing PMI data will be released on Monday.

Investors would also keenly watch updates from the European Central Bank policy meet next week.

Additionally, US nonfarm payrolls data and data on unemployment rate will remain in focus.