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US-China trade deal, GST Council meet, RBI minutes to guide Dalal Street this week

US agreed to a phase 1 of trade deal with China on Friday, averting Dec 15 round of tariffs.

, ETMarkets.com|
Dec 15, 2019, 10.53 AM IST
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Nifty50 is just 72 points away from its lifetime high.
The US-China trade deal, GST Council meet and a clear path for Brexit are some of the key factors that will guide Dalal Street this week.

A major resolution through the IBC court that comes to finalisation may also cheer investors. Media reports on Friday suggested that ArcelorMittal is all set to take control of Essar Steel and has transferred around Rs 40,000 crore to the creditors.

The minutes of the Reserve Bank of India’s MPC meet to be released this week will also give a deep insight on what it thinks about the state of the economy.

Here are the key factors in details that may guide the market throughout the week:

US China trade deal
The US agreed to a phase one of the trade deal with China on Friday, averting December 15 round of tariffs. The market would react to further details of the same. The deal reduces some US tariffs on Chinese goods while boosting Chinese purchases of American farm, energy and manufactured goods and addressing some US complaints about intellectual property practices.

Path clear for Brexit
Even though Boris Johnson won the popular mandate in the UK general election. The UK parliament is expected to consider the issue before Christmas. After that the European Parliament would then vote on the deal. This process is expected to pass smoothly, enabling Johnson to stick to the current scheduled exit date of January 31, 2020. However, real struggles begins later as it will have to strike a trade deal with the EU, otherwise it could mean a chaotic situation for Britain.

GST Council meet
The GST council will meet for 38th time on December 18, which will be eyed by the marketmen. The council is expected to review alternative mechanism for compensation cess, and look at ways to boost revenue from indirect taxes. A further simplification of the upcoming New GST Returns system is also on the cards. Speculations are rife that there will be another major rejig in GST rates in the upcoming meeting.

ArcelorMittal transfers money
As per reports, the largest steelmaker in the world transferred about Rs 40,000 crore to the current account of Essar Steel's lead banker, State Bank of India to complete the takeover process of Essar Steel. SBI will distribute the money as decided by the committee of creditors, most likely on December 16. PSU Banks jumped over 4 per cent last week as they are set to be the biggest gainer from the transaction and they could gain further.

MPC minutes
RBI will release the minutes of the monetary policy committee meeting held in the first week of December on Wednesday. The committee in a surprise decision had kept the benchmark lending rates steady, taking a break from five straight cuts.

Prince pipes to come with IPO
Prince Pipes and Fittings’ initial public offer (IPO) to raise up to Rs 500 crore will open on December 18. The polymer pipes and fittings manufacturer has set a price band of Rs 177-178 for its offer, which includes a fresh issue of Rs 250 crores and an offer for sale of Rs 250 crores The minimum bid lot is 84 equity shares and in multiples of 84 equity shares thereafter.

Tech View
Nifty made bullish candles on daily and weekly charts and formed higher highs and higher lows for the second session on Friday. According to market experts, the last three sessions of upmove is hinting at the completion of corrective swing from recent low of the 11,832 level.

“Oscillator setup on lower time frame charts is turning bullish. Nifty shall ideally head towards its lifetime high placed at around 12,158. However, considering the fact that index has erased four sessions of losses in just two days, some breather for the bulls can be expected in the next session,” said Mazhar Mohammad, Chief Strategist-Technical Research & Trading Advisory at ChartviewIndia.

The index is just 72 points away from its lifetime high and a small followup could lead the fresh leg of rally.

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