Markets to focus on auto stocks, macro data in first week of 2018
Mumbai: As the new year begins, the markets are expected to shift focus to budget and December quarter corporate earnings. This week, the markets will eye December auto sales and macro data.
According to Chetan Ahya, global co-head of economics and chief asia economist at Morgan Stanley, pick-up in investment growth, a gradual rise in core inflation, steady removal of monetary accommodation, contained financial stability risks in the US and a moderate slowdown in China will be factors on how the macros will unfold in 2018.
“From a markets perspective, our strategists highlight that there could be a more challenging market backdrop as the year progresses, inflation rises and financial conditions become less supportive. Hence, they see that there will be an opportunity to reduce risk later in Q1. With regards to positioning, they prefer developed markets in equities and emerging markets in fixed income,” he said.
Meanwhile, auto stocks will be in focus this week as December sales data will be released on Monday. Mustafa Nadeem, CEO, Epic Research, said, “The markets will be critically examining the auto sales data since it can further lead the momentum. Maruti is expected to post decent sales numbers.”
On the macro front, Nikkei manufacturing purchasing managers’ index (PMI) for December will be released on Tuesday, while services sector PMI for December will be out on Thursday.
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