DEC – FIRST WEEK ACTION-PACKED!

about 10 months ago
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Today, we begin the last month of this year; a year which we all want to get over with as quickly as possible. This will be a truncated week as we have only four days of trading but the it is action-packed and there is the promise of a lot of drama too.

This week is pretty newsy. More than the RBI, which currently has no option but to just sit tight, eyes will be on the auto sales coming in today. Sept and Oct were very good and Nov had Diwali – so all want to see if the same trend of Oct continues into Nov or are, we beginning to see a tapering effect? The auto companies, OEMs and dealers have already given a positive vibe and lets see how that gets translated into numbers. If the numbers remain good, you most certianly can expect a euphoric mood.

There is the Manufacturing and Services PMI data too; given the lower-than-expected contracted GDP for Q2, every macro data is now important. PMI is more current – its of the month gone by while IIP is one-month too late. Thus in that sense, PMI will give us a sense of whether activity has picked up considerably at factories – an indication of the recovery we all are waiting for. But keep a eye on the services too as that has a huge slice of the pie in our growth story.

This month, apart from RBI, we will have policy decisions from US Fed Reserve by mid-month – and these two will be watched even if they are predicted to be a non-event.

Over and above all these, any news on vaccination trials and their distribution will be the main market mover. All said and done, for any of this macro news and policy actions to have any impact, the Covid situation needs to dissipate on which hinges the shape of economic recovery – ‘V’ shaped or ‘W’?

The numbers in Delhi are surging and there is news of “surge upon surge” expected in USA. Thus apart from news-centric action, the overall focus will remain on the pandemic. India might not see a lockdown like before but as cases surge, we could see night curfews and few more restrictions coming in.

It’s a short week but completely news-packed. Lets see how it all unfolds…

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