Stock Market Prediction Next Week (1- 5 Jan 2024)
Stock Market Prediction Next Week (1- 5 Jan 2024): Indian stock market indexes closed slightly lower on Friday, the last trading session of the year but, ended with significant gains on a weekly and yearly basis. The domestic markets gained three out of four trading sessions during the holiday-shortened week. The sentiments remained favorable due to FIIs & DIIs inflow, positive global cues, and ease in crude oil prices.
In the coming week, global and domestic macroeconomic data will be in focus and will set the market trend. The crude oil prices, movement in the rupee against the dollar, and FII & DII’s investment will also be monitored closely. Traders will keep a close eye on monthly auto sales numbers and GST collections on Monday.
On the global front, PMI numbers from several countries, the US unemployment rate, and FOMC minutes will set the global market trends in the upcoming week. Most of the global markets including the US and Europe will remain closed on Monday, 1st January 2024 for New Year Celebration. The key factors that are likely to impact the stock market prediction are given below.
Stock Market Prediction Next Week (1- 5 Jan 2024)
Nifty & Bank Nifty Prediction
After a rally of five consecutive sessions, Nifty took a breather near the 21800 zone halting the ongoing rally. The Nifty index remained rangebound for the entire session on Friday near the 21720 zone with bias maintained positive.
The Nifty index would have maintained 21550 levels as the near-term support zone, while the next major targets of 22200-22300 levels are expected in the coming days with the strong uptrend still maintained intact.
The Bank Nifty index finding resistance near the 48500 level slipped down to its near-term support maintained near the 48000 zone. Whereas, the Bank Nifty will maintain 46300 levels as the strong support zone. The support and resistance in Bank Nifty for the week will be at 47000–49700 levels.
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Domestic Macroeconomic Data
On the economic front, the country’s eight core sector data output growth hit a six-month low of 7.8% in November easing from 12% in October due to a high base effect. Meanwhile, separate data showed that retail inflation for industrial workers rose in November as compared to October due to higher food prices. On Monday, markets may react negatively to the subdued economic data released after the closing bell on Friday.
In the upcoming week, investors will be closely monitoring the GST collection numbers to be announced on Monday. The S&P Global PMI number for manufacturing and services will also remain the focus The other scheduled for other key macroeconomic data for next week is given below.
| Economic Data Next Week | |
| 3 January 2024 | S&P Global Manufacturing PMI Dec |
| 5 January 2024 | S&P Global Services & Composite PMI |
| 5 January 2024 | Foreign Exchange Reserve |
| 5 January 2024 | Fiscal Year GDP Growth Preliminary |
Auto Sales Number
Auto stocks will be in focus next week, as auto companies will start announcing the December auto sales numbers from 1st January 2024 onwards. According to market experts, Indian passenger vehicle (PV) manufacturers have estimated a notable drop in deliveries to dealerships, due to a decline in sales in December. The decline in demand post-festivals and the influence of a robust performance in the previous year have led automakers to scale back their dispatches.
However, the PV segment may witness robust growth overall year-on-year in volumes on account of a large order book. Further, the experts believe that the tractor volumes are likely to be better on a YoY basis but decline MoM due to seasonality.
In addition, 2-wheeler volume growth continues to be positive YoY, supported by marriage season demand and favorable base effect. The auto stock may witness some profit booking in the next week, investors who have a position in auto stocks should remain cautious.
Global Stock Market Prediction Next Week
Global stock markets ended higher during the holiday-shortened week. The major stock markets were shut on December 25th on account of Christmas, while some markets extended their holiday period until December 26th to observe Boxing Day. The market volume was thin and economic data released during the week were limited, as traders were mostly on a holiday break.
The US stock markets concluded the year 2023 with their ninth consecutive weekly gains and finished on a strong note. The data released in the US was very limited last week and in a negative tone. The major equity market indexes in Europe ended in mixed fashion. Meanwhile, China snapped a sixth-week losing streak and ended higher as online gaming stocks bounced back after the previous week’s sharp fall.
Also read, Global Stock Market Indexes End 2023 Positively: Weekly Analysis
In the coming week, most of the global markets will remain shut on Monday on account of the New Year Celebration. The macroeconomic data including manufacturing and services PMI, US unemployment rate, and Inflation data from Europe will remain in focus. All eyes will be on the Fed’s minutes of the December 2023 meeting, for more clues about the early interest rate cuts.
Global investors are expected to remain in a holiday mood until the middle of next week, some will observe extended holidays also. The majority of the economic data set for release next week is scheduled for the 4th and 5th of January. Consequently, the global markets are likely to experience increased volatility in the latter half of the week.
Global Macroeconomic Data
| Important Global Macro Data Next Week | ||
| 2 January 2024 | Ciaxin Manufacturing PMI Dec | China |
| 2 January 2024 | HCOB Manufacturing PMI Dec | EA |
| 2 January 2024 | S&P Global / CIPS Manufacturing PMI Dec | GB |
| 03 January 2024 | S&P Global Manufacturing PMI Dec | US |
| 03 January 2024 | ISM Manufacturing PMI | US |
| 03 January 2024 | JOLTs Job Opening Nov | US |
| 4 January 2024 | FOMC Minutes | US |
| 4 January 2024 | Jibun Bank Manufacturing PMI Final Dec | Japan |
| 4 January 2024 | Ciaxin Services & Composite PMI Dec | China |
| 4 January 2024 | HCOB Services PMI Dec | EA |
| 4 January 2024 | S&P Global/CIPS Services PMI | GB |
| 4 January 2024 | ADP Employment Change Dec | US |
| 4 January 2024 | Initial Jobless Claim | US |
| 4 January 2024 | S&P Global Services and Composite PMI Dec | US |
| 5 January 2024 | Jibun Bank Services and Composite PMI | Japan |
| 5 January 2024 | Consumer Confidence Dec | Japan |
| 5 January 2024 | Halifax housing prices Dec | GB |
| 5 January 2024 | Inflation/ Core Inflation / PPI Rate Flash | EA |
| 5 January 2024 | Non farm Payroll Dec | US |
| 5 January 2024 | Unemployment Rate Dec | US |
| 5 January 2024 | Factory Oders Nov | US |
| 5 January 2024 | ISM Services and Business activity | US |
Crude Oil Prices
Crude oil prices snapped a two-week winning streak and closed in the red. The crude oil prices fell in the last three consecutive sessions as shipping companies are ready to transit the Red Sea route, easing concerns about supply disruptions.
The crude oil prices rose earlier this month, as major shipping companies stopped using the Red Sea route and the Suez Canal after Yemen’s Houthi militant group began targeting vessels. In the week ended 29 December, US-based WTI crude declined 3% while London-based Brent crude was down by 2.73%. Traders should closely monitor the crude oil prices in the upcoming week, as ease in crude prices will support the domestic markets.
FII & DIIs flow
Foreign Institutional Investors (FIIs) were turned net buyers last week in the Indian equity cash segment. They bought shares worth Rs 8648.96 crore. Meanwhile, Domestic Institutional Investors (DII) continued their buying spree, they bought shares worth Rs 666.06 crore.
FII activity is expected to remain subdued in the upcoming week due to the New Year holiday break for many traders. However, traders need to monitor both FIIs and DIIs activity closely. The continuous FII buying spree in the Indian equity markets has the potential to uplift market sentiments and drive the market to new highs.
Conclusion
Global markets will be closed on Monday, but Indian stock markets will remain open. Traders will be in a New Year mood during the initial days of the week. Thin trading volumes are expected, and markets are likely to trade sideways in the first two trading sessions.
The latter half of the week will be influenced by domestic economic data, FOMC minutes, and other global cues and will set the market direction. Indian stock markets are likely to trade within a range in the upcoming week. investors can also follow our Daily Morning Report at 7:30 a.m. for market direction.
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