India’s benchmark indices are likely to swing either way in the coming week as good work is done by earnings season so far will be undercut by the fears of Coronavirus impact.
In fact, stocks are likely to remain hostage to developments involving the coronavirus in the week ahead, and even so, the market could continue to hit new highs.
Economists have been reducing China’s growth outlook for the quarter, with some seeing little or no growth and then a bounce back in the high single digits next quarter. The US economy is not expected to take a big hit, but the question for the stock market is how will corporate earnings be impacted.
In the week gone by, indices reversed early gains to end lower, dragged down by banks exposed to telecom operators who were told by SC to clear their dues by March 17.
Markets continued to face headwinds from both domestic and global fronts, however, the benchmark still looks comparatively stable. Stocks, on the other hand, are witnessing volatile swings and we expect this trend to continue, at least in the near future. In the absence of any major local event, the global cues will largely dictate the market trend.
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