Economic Roundup, January 04, 2019

Economic Environment

  • Global growth and corporate earnings

How are the Indian and global economic environments affecting the financial markets?

  • Indian financial markets have been skittish taking cues from volatility in the US markets due to political risk and uncertainty about the upcoming 2018 Fourth Quarter corporate earnings releases beginning January. Indian economy, however, has strong fundamentals while the rest of the world economy appears to potentially experience a slowdown in 2019 including the US economy though the United States may not enter a recession. Global economic concerns and political risk in relation to the upcoming parliamentary general elections in India in 2019 will continue to affect the Indian financial markets through the first two quarters of calendar year 2019.

    What to expect from the markets next week?

Indian financial markets will continue to takes cues from global markets on global growth though they may not be as volatile as the US and other major global financial markets. Range-bound and flat behavior can be expected in the coming week. It must be noted that beginning next week corporate earnings reports could determine whether the major Indian indices will formally enter correction territory because both BSE SENSEX and NSE NIFTY 50 are already hovering close to 10 percent decline from their 52-week highs.

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