Market Ahead, January 17: Top factors that could guide markets today

Investors will focus on corporate earnings and any newsflow regarding the Union Budget for market direction today.

A total of 18 companies, including Reliance Industries, Tata Consultancy Services (TCS), and HCL Technologies, are scheduled to release their December quarter numbers later in the day.

According to analysts, Reliance Industries is likely to see a flat Q3 performance amid weakness in the petrochemicals (petchem) unit’s performance even though retail and telecom segments are likely to gain further.

Similarly, IT bellwether TCS is also expected to put up a muted show in the third quarter. The company witnessed higher furloughs during the quarter than in the corresponding quarter of FY19, especially in the Banking and Financial Services vertical.

Telecom stocks will be in focus today after the Supreme Court rejected the review petitions moved by Bharti Airtel, Vodafone Idea and Tata Teleservices against its order on payment of dues linked to adjusted gross revenue. Telcos will have to together pay an estimated Rs 1.47 trillion in AGR dues by January 23. 

Besides, stock-specific action, oil price movement, and the Rupee's trajectory will also influence investor sentiment.

Upbeat earnings and robust manufacturing data lifted Wall Street to record highs on Thursday. The S&P 500 rallied through the 3,300-mark for the first time, the Dow Jones rose 0.9 per cent, and the Nasdaq Composite added 1.06 per cent. Asian shares inched higher on Friday. In early trade. MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.19 per cent. Australian shares were up 0.5 per cent, and Japan's Nikkei added 0.55 per cent. The SGX Nifty, though, was trading with minor cuts suggesting a flat start for domestic indices.

On Thursday, the BSE Sensex closed 60 points up at 41,933, while the Nifty50 settled 12 points up at 12,355. Broader markets continued to outperform. The BSE Midcap gained 0.77 per cent while the Smallcap index closed 0.78 per cent higher.

Going forward, analysts say that the probability of the Nifty taking of the crucial hurdle of 12,400 is quite high. Hence, one can buy the Nifty for the target of 12,450 with stop-loss at 12,295.

And, in the end, here's a stock idea by Anand Rathi Shares and Stock Brokers which recommends buying Rico Auto for the target of Rs 58 with stop-loss at Rs 46.