Mumbai, Feb 16 (IANS): Developments in terms adjusted gross revenue (AGR) by telecom operators payments and the pace of spread of the coronavirus would be among the key factors to drive the Indian equity markets in the week ahead.

On Friday, both Sensex and the Nifty slumped after opening on a positive note, as the Supreme Court initiated contempt proceedings against telecom companies for non-payment of AGR dues and directed them to pay these by March 17. The top court also came down heavily on the Department of Telecom (DoT) for failing to recover the dues from the operators even after its October 24 order and chided the ministry for granting protection to the telcos against payment of the dues.

Since then, the DoT has swung into action to recover the dues and asked the telcos to pay these "immediately". Banking and financial stocks, which witnessed heavy selling on Friday after the court order, may decline further in the coming week with developments on the AGR front. The total AGR dues stand at Rs 1.47 lakh crore.

The Supreme Court's order has cast a shadow on the survival of telecom major Vodafone Idea, which is already reeling under financial distress. Rajnish Kumar the Chairman of State Bank of India on Saturday raised concerns in the matter and said that any business closure will impact the entire ecosystem of banks, government, vendors and employees.

Also, the spread of coronavirus infection is likely to further impact the Indian stock markets along with the global markets.

The number of fatalities from China's new coronavirus (COVID-19) epidemic climbed to 1,665 on Sunday after 142 more people died due to the infection that has spiralled into a nationwide health crisis in the country. According to reports, the total number of cases of coronavirus infection in the country has now risen to 68,500 patients.

Siddhartha Khemka, Head of Retail Research, Motilal Oswal Financial Services said: "Indian equity markets witnessed huge volatility during the week on account of fear about the coronavirus and the economic damage it can lead to. Going forward, markets may remain range-bound due to lack of trigger or major event, domestically. It would closely watch the developments with regards to coronavirus and may remain under pressure in the near term."

Further, analysts also say that the minutes of the meeting of Reserve Bank of India's (RBI) Monetary Policy Committee (MPC), scheduled to be released on Thursday would also be a factor in the market.

"Markets will look forward to a variety of data, both local and global, in the coming week and among them the release of RBI minutes remains the foremost," said Deepak Jasani, Head of Retail Research of HDFC Securities.

Among the global factors, a major development would be the release of the minutes of the meeting of the United States Federal Open Market Committee (FOMC), he said. Movement in crude oil prices would continue to play its role in the week ahead, according to analysts.

On the technical front, Jasani said that the Nifty could consolidate in a range between the 12,000-12,300 levels in the coming week. "It is important that the supports of 11,990 hold, else the intermediate downtrend could resume once again," he said.

On Friday, the Nifty50 on the National Stock Exchange closed 61.20 points lower, or by 0.50 per cent, at 12,113.45.

The BSE Sensex closed at 41,257.74, lower by 202.05 points, or 0.49 per cent, from its previous close of 41,459.79.

The week ahead, however, would be a holiday-shortened week as markets would remain closed on Friday, on account of 'Mahashivratri'.