Sensex, Nifty likely to open flat with positive bias

Global cues are encouraging for now. Funds are showing more interest in large-caps which have shaved off value in the recent turmoil. The currency movement will also be closely eyed even as the world keeps on watch on where crude prices are headed.

It could be a week best forgotten for the stock market world over as China’s woes had a cascading impact on sentiment world over. Thursday's selloff, which saw one of the worst shows in five months, resulted in Rs 2.5 lakh crore of investor’s wealth vanishing into thin air. Amidst all the gloom, Finance Minister Arun Jaitley says Indian economy has emerged as one of the fastest growing economies in the world indicating that the economy is firmly on the path of economic revival.

The outlook is a flat to positive start. Whether it can sustain till the end of the day remains to be seen. Global cues are encouraging for now. Funds are showing more interest in large-caps which have shaved off value in the recent turmoil. The currency movement will also be closely eyed even as the world keeps on watch on where crude prices are headed. Investors will prefer to remain a bit on the sidelines and probably look to play on counters which will announce their results in the coming week.

A challenging macro environment is here to stay. A conservative portfolio positioning would be a prudent approach given modest earnings growth and above-average valuations calls.
Sectors and stocks with low earnings and valuation risks should be on the buying list. Consumer staples, energy, and IT would be sectors to nibble on while financials, industrials and materials could be given a miss for the time being.

Auto stocks will be in focus in the coming days as Union Minister for Road, Transport & Highways, Nitin Gadkari will meet representatives of automobile companies on January 14 to allay their concerns about the Government’s move to directly move from BS IV emission norms to BS VI emission norms by April 2020.

German car maker Volkswagen reportedly said that it will not buy back any car models as its models and others sold under SKODA and Audi brands do not violate the Indian emission norms.

Saudi Arabia is reviewing an initial public offering (IPO) of Saudi Aramco, the world’s biggest crude oil producer, the kingdom’s deputy crown prince Mohammed bin Salman has been quoted as saying.