Ten key factors that will keep traders busy this week

Last week, the Indian stock markets remained under pressure, tracking a collapse in global equities amid growing concerns about novel coronavirus' impact on global economy.

Nifty50 registered its worst weekly fall in since 2009, while making it one of the worst monthly fall since September 2018.

While the S&P BSE Sensex plunged 5.96 percent, Nifty50 was down 6.21 percent in the month of February.

"In the forthcoming week, all eyes would be glued on the most awaited SBI Cards IPO and RITES OFS by the Government of India. No matter the outcome, markets would broadly be driven by the virus and global sentiment," Jimeet Modi, Founder & CEO, SAMCO Securities & StockNote said.

 

While the Sensex lost 2,872.83 points (7 percent) to end at 38,297.29 in the past week, the Nifty shed 879.05 points (7.3 percent) to end at 11,201.8.

The BSE large-cap index shed 7.4 percent, BSE small-cap index and mid-cap index fell 7 percent last week.

This week, auto companies are going to report their monthly sales numbers for the month of February 2020.

According to experts, the wholesale numbers are expected to be under pressure in CVs, 2Ws and PVs due to inventory correction by dealers before the BS6 transition.

However, marginal growth is likely to be seen in tractors due to the low base from last year and improved customer sentiment.

While M&M is expected to see 5 percent YoY growth, Escorts should register flat growth. The low base from last year and better customer sentiment are supporting demand, Emkay said.

In the domestic market the volume declines are expected for TVS Motor (-22 percent YoY), Hero MotoCorp (-16 percent) and Bajaj Auto (-14 percent).

According to Motilal Oswal, in February 2020, the wholesale volumes are estimated to decline 20 percent/11 percent/35 percent YoY for 2Ws/PVs/CVs due to stopping of BS4 production. Tractors are expected to grow by 5.5 percent YoY.

The initial public offering of SBI Cards and Payment Services, the credit card arm of State Bank of India (SBI), will open for subscription on March 2 and will close on March 5.

The company plans to issue new shares worth Rs 500 crore and an offer for sale of up to 13,05,26,798 equity shares.

As a part of the offer for sale, parent company SBI will sell up to 3,72,93,371 shares and CA Rover Holdings, an affiliate of the Carlyle Group, will sell up to 9,32,33,427 shares.

SBI Cards proposed to raise Rs 10,289 crore at the lower end of the price band (Rs 750 per share) and Rs 10,355 crore at the upper end (Rs 755 per share).

Antony Waste Handling Cell is expected to launch its nearly-Rs 300 crore initial public offering for subscription on March 4.

It comprises a fresh issue of up to Rs 43.5 crore and an offer for sale of up to Rs 250 crore.

The offer for sale comprises a 94,42,164 equity shares by Leeds (Mauritius) (13,90,322 shares), Tonbridge (Mauritius) (20,85,502 shares), Cambridge (Mauritius) (20,65,300 shares) and Guildford (Mauritius) (39,01,040 shares).

The issue will close on March 6. The company has proposed to utilise the net fresh issue proceeds towards the reduction of the aggregate outstanding borrowings.

Equirus Capital Private Limited is the sole book-running lead manager (BRLM) to the offer. The company does not have any listed industry peers in India.

Foreign Institutional investors (FIIs) remained net sellers last week as they sold equities worth Rs 11,368.67 crore.

FII remained sellers for the second consecutive month as they had sold equities worth of Rs 12,684.30 in February, while they sold equities worth of Rs 5,359.51 crore in January.

On the other hand, Domestic Institutional investors (DIIs) remained net buyers in February, as they bought equities worth Rs 16,933.03 crore. In the  last week they bought Rs 15,985.82 crore worth of equities.

The rapid spread of the novel coronavirus, now named CORVID-19, remained the major fears for the world economy after six other countries reporting their first cases.

Around 2,870 people had died in China as of March 1 due to the novel coronavirus. The total number of confirmed cases in mainland China stood at 79,824.

Global sentiments remained weak as more cases of coronavirus are being reported outside of China, especially in South Korea.

A meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies including Russia, a grouping known as OPEC+, is scheduled to be held in Vienna, Austria over March 5-6.

Oil prices slipped for the sixth consecutive day to its lowest in over a year on the fears that a slowing global economy would hit energy demand.

The Brent Crude price slipped by $20 in nearly two months to $50 per barrel, which is the lowest level since December 2018.

Last week, Brent Crude shed almost 14 percent, registered a biggest weekly percentage decline since January 2016.

India Manufacturing PMI and Service PMI numbers to be release on March 2 and March 4, respectively. The country's manufacturing sector activity climbed to a near eight-year high in January, driven by a sharp rise in new business orders.

Manufacturing activity has continued to rise for the last three months, while it remained above 50-point mark in the 30th consecutive month.

The manufacturing sector activity climbed to a near eight-year high in January 2020 at 55.7 against 52.7 in the previous month.

The manufacturing PMI rose to 55.3 in January from 52.7 in December 2019. However, the IHS Markit India Services Business Activity Index rose from 53.3 in December 2019 to 55.5 in January.

Last week, Nifty remained under pressure as bears had an upper hand over the bulls. The index made the 'lower high and lower low' formation on the daily chart.

The support of the rising trend line of wedge pattern is coming around 11,000, so there is still room for 200 points in Nifty on the downside, experts suggest.

"The overall trend for Nifty continues to remain negative until it reclaims 11600 mark on the higher side. The momentum indicator MACD has already provided sell crossover in the previous week which is hinting of further weakness in the Nifty," Nilesh Ramesh Jain, Derivative analyst- Equity Research at AnandRathi said.

"Although after falling for the seventh straight session, dead cat bounce cannot be ruled out and expect a tepid start on Monday with a negative bias," he added.

Nifty continued to make lower highs - lower lows and formed a Big Bearish Candle on weekly scale as sustained selling pressure was seen for most part of the week.

The Nifty started the March series with a higher open interest (OI) base whereas rollovers were at 77 percent, which is much higher than its three months’ average rollover.

During the week, the Nifty turned into a discount of 40 points, which is clearly pointing towards aggressive short formation.

The 11,000 strike Put holds the highest OI for coming week whereas positions are also seen in 10,800 and 10,700 strikes indicating a move below 11,000 would open more downsides.

Here are the key corporate actions taking place in week ahead:

 

Here are the key global data points to watch out for in week ahead:

 

(Source: Moneycontrol.com)