Five factors that may affect market movement next week

The Indian stock market will take cues from various developments during the upcoming holiday truncated week.  The market which will remain closed on November 16 on account of Diwali Balipratipada may start on a high note on Tuesday after it set fresh records in the Muhurat trading session.

On the occasion of Diwali, Sensex and Nifty surged to lifetime highs in Muhurat trading on November 14 as investors built up fresh positions to mark the beginning of Hindu Samvat year 2077.

While Sensex soared 194.98 points or 0.45 per cent to close at a record 43,637, Nifty advanced 60.30 points, or 0.47 per cent, to finish at its lifetime high of 12,780. During the day, Sensex and Nifty hit lifetime highs of 43,830 and 12,828, respectively.

On Sensex, top gainers were Bharti Airtel, Tata Steel, Sun Pharma, Bajaj Finserv, ITC, Infosys, HDFC Bank and ONGC, rising up to 1.17 per cent.Global brokerages turn bullish on Indian equities, set new targets for Nifty   

Domestic markets conduct a special one-hour Muhurat trading session on Diwali every year to mark the beginning of the traditional Hindu calendar year, called 'Vikram Samvat'. In the previous Samvat 2076, the BSE Sensex gained 4,384.94 points or 11.22 per cent, while the Nifty rallied 1,136.05 points or 9.80 per cent.

Over the past week, the 30-share BSE Sensex jumped 1,744.92 points or 4.16 per cent.

Here's a look at factors which may decide the direction of Sensex and Nifty during the upcoming week.

Coronavirus cases

The market will react to COVID-19 tally in India and the world next week.  In India,  the caseload has gone past the 88-lakh mark. The number of people who have recovered from the disease has crossed 82 lakh, raising the national recovery rate to 93.09 per cent, according to the health ministry's data.

The total number of coronavirus cases rose to 88,14,579 with 41,100 of those reported in a day, while the death toll climbed to 1,29,635 with 447 new fatalities.

The number of active cases remained below five lakh for the fifth consecutive day. There are 4,79,216 active cases of the coronavirus infection in the country as on date, which accounts for 5.44 per cent of the total caseload, the data stated.

Meanwhile, the number of active coronavirus cases globally crossed the 15-million mark on Sunday to stand at 15,147,742 which could adversely affect the prospects of economic recovery.

Vaccine developments

US drugmaker Moderna Inc may release first interim analysis data on late-stage trials of its Covid-19 vaccine candidate. Experts have said that Moderna's candidate, which uses a similar mRNA technology like Pfizer's, will also likely prove to be highly effective. US pharmaceutical firm Pfizer last week said the Covid 19 vaccine developed by the firm and its German partner BioNTech was found to be more than 90 per cent effective in preventing the virus.

The company is expected to produce up to 50 million or five crore doses in 2020, and 1.3 billion (130 crore) doses in 2021, a Pfizer spokesperson said. After Pfizer's statement, global markets surged on hopes of an economic recovery at a faster pace.

FIIs inflows

In November, FIIs have infused Rs 33,232 crore into Indian equities. The foreign funds come at a time when Indian markets have surged to all time highs due to US polls and Q2 earnings at home.

In fact, during the last 11 sessions, FIIs have become net buyers in the equity market. If the trend continues, benchmark indices may not see a strong correction and hold on to record highs logged during this month.

Economic data

Wholesale price inflation data for October will be released on Monday which may affect the sentiment in the market. Foreign exchange reserves for the week ended November 13 and bank loan and deposit growth for fortnight ended November 6 will be announced on Friday which may affect the market closing for the week.

For the week ended November 6, the country's foreign exchange reserves remained strong, rising $7.78 billion to an all-time high of $568.49 billion.

Global markets

Any positive developments on the vaccine front may fire up global markets which have welcomed Joe Biden's victory over President  Donald Trump in the US poll.

News on the vaccine front is considered as a big respite for the global economy which has been mired in a cycle of recession since rising cases of coronavirus brought all major economies to a standstill.  Prospects of an additional stimulus by the new government also pushed the US market higher.

On Friday, the S&P 500 closed at a record high as optimism built among investors that a coming vaccine for the coronavirus will help end the shutdowns that have devastated the economy. The benchmark index posted its second weekly gain in a row. The Dow rose 399.64 points, or 1.4%, to 29,479.81 and the Nasdaq rose 119.70 points, or 1%, to 11,829.29.

Diwali Balipratipada: Equity, commodity, currency markets to remain closed on November 16