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Market Ahead, January 1: Top factors that could guide markets today

Investors' concern over fiscal slippage and contraction in core sector is likely to dominate today's session while the progress in the US-China trade deal might offer some relief

BS Web Team  |  New Delhi 

Investors' concern over fiscal slippage and contraction in core sector is likely to dominate today's session while the progress in the US-China trade deal might offer some relief.

Fiscal deficit of the Union government rose to 114.8 per cent of the target in the first eight months of the fiscal year, data released by the Controller General of Accounts showed. The gap between the government’s revenue and spending stood at Rs 8.07 trillion at the end of November — 13 per cent more than the full-year target.

Secondly, the output of eight core sectors of the economy fell for a third straight month in November, contracting by 1.5 per cent as key sectors like refinery products and electricity continued to see slow growth or contraction.

In today's session, infra stocks will be in focus after Finance Minister Nirmala Sitharaman yesterday announced plan to provide Rs 102 trillion infra-push over the next five years

Automobile companies will also react to their December sales figures which will be released starting today.

Apart from this, market participants will track the rupee's and the oil's trajectory as well as the foreign fund flow for further cues.

Globally, US President Donald Trump has said the Phase 1 trade pact with China would be signed on January 15 at the White House, though confusion remains about details of the agreement. Following Trump's announcement, the Dow Jones rose 0.27 per cent, the S&P 500 gained 0.29 per cent, and the Nasdaq Composite added 0.3 per cent. The SGX Nifty, though, indicated a negative start to the day for domestic indices.

Back home, in yesterday's session, year-end profit booking by investors dragged indices lower. While the S&P BSE Sensex settled at 41,254, down 304 points, the broader Nifty50 index closed at 12,168, down 87 points.

The Nifty has now been facing stiff resistance at 12,300 for last three consecutive weeks. Analysts say that any level above 12,300 would result in to fresh breakout so traders should hold longs in Nifty with 12,100 as the stoploss.

In the end, here's a trading idea by HDFC Securities which recommends bying Gujarat Gas at Rs 238 for the target of Rs 252 with stop-loss at Rs 230.

First Published: Wed, January 01 2020. 08:16 IST
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