Global cues may force weak opening of the markets

Indian equities market on Friday tumbled in the conclusive session, after quarterly earnings of HUL and benchmark indices lost further ground, closing lower than 2% last week on account of weak global cues; weak corporate earnings; depreciating Indian currency; disappointing macro-economic data; and downfall in crude oil prices. The Sensex closed 317.93 points, or 1.28%, lower at 24,455 and shed 1.92% over the week. The Nifty lost 99 points, or 1.31%, quoting 7,437.80 and ended the week 2.15% lower. Broader markets also witnessed selling pressure with the BSE Mid-cap index dropping by 648.53 points or 5.90% to 10,343.73; while the Small-cap index was down by 869.09 points or 7.46% quoting 10,782.88 during the last week. The rupee weakened and hit a 28-month low of Rs 67.69 against the US Dollar and fell 1.14% during the last week.

U.S. stocks closed sharply lower on Friday due to disappointing U.S. data, ahead of a long weekend. US retail sales fell in December and slipped 0.1% after rising 0.4% in November. For all of 2015, retail sales rose 2.1%, the weakest reading since 2009, after rising 3.9% in 2014. US industrial production fell 0.4% in December, primarily as a result of cutbacks for utilities and mining, after declining by 0.9% in November. For the fourth quarter as a whole, industrial production fell at an annual rate of 3.4%. The Dow Jones Industrial Average slumped 390.97 points, or 2.4%, quoting 15,988.08; while the S&P 500 slid 44.85 points, or 2.3%, to 1,876.99. The Nasdaq Composite tumbled 126.59 points, or 2.7%, quoting 4,488.42.

European markets finished deep in the red on Friday, as oil prices slumped below USD 30 per barrel, leaving the market lower for a third consecutive week. The Stoxx Europe 600 slumped 2.8% to end at 329.84 and was 3.4% lower in the last week. Germany’s DAX 30 gave up 2.5% to close at 9,545.27; and France’s CAC 40 lost 2.4% quoting 4,210.16. They ended the week down 3.1% and 2.9%, respectively. The U.K.’s FTSE 100 shed 1.9% quoting 5,804.10.

Crude oil prices fell below USD 30 a barrel on Friday as the prospect of additional Iranian supply looms over the market while US stockpiles increase. U.S. crude oil settled down USD 1.78, or 5.71%, at USD 29.42 a barrel, the first settlement under USD 30 in 12 years. WTI lost 11.3% for the week, its worst in more than a year.

Asia extends sell-off on early Monday, following weak U.S. economic data, and decline in oil prices and worries about a global economic downturn. Japan’s Nikkei 225 index fell 1.8% while South Korea’s Kospi index dropped 0.34%. Australia’s S&P/ASX 200 Index dropped 0.88%. New Zealand’s S&P/NZX 50 Index slide 1.4%. Shanghai Composite index was down by 0.45%.

While on domestic front, A SGX Nifty 50 index future for January Series traded down 24 points at 7,417. Indian markets may open on weak note due to negative global cues. For the week ahead, quarterly earnings major companies like Kotak Bank, Wipro, HCL Technologies, Axis Bank, Biocon, Reliance Industries etc., will be announcing their numbers.