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Indian markets closed almost 6-week highs on Wednesday as it extended gains for the third straight session this year, led by banking and financial-based rally. Today, the markets are likely to get gap-down opening amid global sell-off. Rising coronavirus cases in the country are also likely to impact the markets. The Centre said India is witnessing an exponential rise in the number of Covid-19 cases, which is believed to be driven by the Omicron variant. India has reported over 6.3 times rise in Covid-19 cases in the last eight days. The total number of COVID-19 cases rose by 58,097 in the last 24 hours, as per a government update on January 5. The Health Ministry said that 43 districts in India are reporting a weekly positivity between 5 per cent to 10 per cent now. Traders will be concerned as ICRA Ratings warned that the third wave of the pandemic, which has seen a massive spike in infections after the more infectious Omicron variant of the coronavirus appeared, is likely to shave 40 bps off the fourth quarter GDP growth that may print in at 4.5-5 per cent. There will be some cautiousness with a private report that as COVID-19 infections spike in the country resulting in restrictions in various states and impacting the fragile recovery, many market participants are expecting RBI to delay the policy normalisation move, which is expected in the February review. Meanwhile, the government has permitted qualified jewellers to import certain kinds of gold including certain unwrought forms through India International Bullion Exchange IFSC. Sugar stocks will be in focus as the Centre issued guidelines for restructuring of loans taken by mills from the Sugar Development Fund (SDF), providing a moratorium for two years and then repayment in five years to eligible defaulting factories. There will be some reaction in real estate industry stocks with a private report that housing sales across top eight cities rose 51 per cent last year, even as the office market continued to slump due to the COVID pandemic with gross leasing witnessing a 3 per cent fall. Liquor companies stocks will be in limelight with report that liquor companies are appealing to state governments to allow them to raise prices amid surging costs of inputs ranging from tamper-proof caps to extra-neutral alcohol, the primary raw material.

The US markets ended lower on Wednesday after U.S. Federal Reserve meeting minutes signaled the central bank may raise interest rates sooner than expected. Asian markets are trading mostly in red on Thursday following a hefty sell-off on Wall Street.

Back home, Indian equity benchmarks continued their bull run for fourth straight session on Wednesday, with Sensex reclaiming the psychological 60,000 levels and Nifty ended above 17,900 mark. Markets made cautious start, amid concerns about increasing cases of the Omicron variant of COVID-19. Traders also remain worried with a private report indicated that growth might be impacted by up to 0.30 per cent in the March quarter as normal economic activities come under pressure due to restrictions being imposed by more states to curb rising Omicron cases. However, key gauges soon turned positive, as traders turned optimistic with State Bank of India former chairman Rajnish Kumar’s statement that country needs to accelerate economic growth to above eight per cent to achieve its target of becoming a $5-trillion economy by 2025. Sentiments remained positive in the second half of the session, as commerce ministry is planning to launch Brand India Campaign to give momentum to exports of both services and products in new markets, as the country’s outbound shipments all set to cross $400 billion this fiscal year. This campaign would serve as an umbrella campaign for promoting goods and services exported by India. Traders took some support with Apparel Export Promotion Council (AEPC) Chairman A Sakthivel stating that strong demand and healthy order books will further help in boosting the country's exports in the coming months. Traders overlooked report that India's services sector expanded for a fifth straight month in December, though the growth pace was slower against the previous month, as demand rose but concerns over another wave of COVID-19 and inflationary pressures cast a shadow over the outlook. Services Purchasing Managers' Index, compiled by IHS Markit, eased to 55.5 in December from 58.1 in November, the lowest since September but still well above the 50-mark that separates growth from contraction. Finally, the BSE Sensex rose 367.22 points or 0.61% to 60,223.15 and the CNX Nifty was up by 120.00 points or 0.67% to 17,925.25.

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