From the moment your baby is born and for the first few months afterward, she'll likely spend much of her time with her hands folded. Her hands won't always be folded together, but rather in a slight fist. Though if you've ever let a baby hold your finger you know what a tight grip it can be. The truth is that infants tend to fold their hands or open them due to reflexes, because for the first several weeks of life, they're unaware of their hands or at least don't seem to understand their hands are parts of their bodies.
After nine months in the womb, newborn babies still tend to stay in a tucked position, hands closed and held close to the body with legs pulled up. Infants will prefer these positions for awhile, which is why swaddling babies seems to calm them down. The closed or folded hands are a natural extension of that curled-up position they kept for months in utero. The more comfortable they are stretching out, the less often they'll keep their hands folded.
There are times when babies bring their hands together in front of them. The Ohio State University Medical Center considers hand clasping as a "self-soother," similar to thumb-sucking or lying down with their legs tucked underneath them. The Ohio State experts note that learning to comfort himself is one of the most important things a baby can do in his first few months of life. They add that these self-regulation skills are a way of starting to gain some control of their bodies and their world.
At first, a baby won't know to reach out and grab something she wants with her hands. But the repetition of folding hands and making a fist will help her when she does begin to understand the connection between her hands and the rest of her body. That sensation of closing her hand will allow her to hold onto a toy a bottle or anything that she wants that's withing reach. When something does touch a baby's palm, such as your finger, the Palmar grasp reflex may kick in and your baby will grip whatever is there in her hand.
Up until 14 weeks or so, babies are mostly unaware of their hands, so it's unnecessary to have hands free to practice grasping objects. Reflexes will lead them to putting their hands in their mouths and pulling them right back out again. But there is no real need for their hands to be free all the time during this period. The self-soothing that accompanies sucking on thumbs or whole hands will come later, along with the practice of holding objects and the dawning realization of how their hands can be used. Until then, the self-soothing of closed and folded hands will be just fine.
By the time a baby is 4- or 5-months-old, the hands may still stay folded during sleep or quiet times for that continued soothing and secure feeling. But by now, those hands will pulling anything they can into the mouth. This is also that time that clapping and reaching for things really begins. Prior to this time, babies may unfold their hands to swipe at things or try to hold things, but the coordination isn't quite there.