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

The benchmark indices lost nearly 1% last week as global selloff dampened sentiments on the Street, although improvement in the Covid situation helped contain downside pressure.

Analysts expect equity markets, this week, are likely to follow the quarterly earnings outcome of listed companies, Covid updates, the pace of vaccination drive in the country and global market trends for further direction. Furthermore, they believe fear of inflation flourishing in developed markets may continue to trickle down to India and keep domestic bourses under pressure.

On the earnings front, more than 170 companies are slated to release their March quarterly numbers, including prominent names like Bharti Airtel, Tata Motors, SBI, Shree Cement, Hindalco, Federal Bank and IOC.

Market participants will also keep a close watch on the Covid situation in the country wherein cases seem to have hit a peak, as projected. The average of daily cases has fallen for seven days in a row with India reporting 281,860 new cases in the last 24 hours. This is the first time since April 21 that India has recorded new cases below the 300,000 mark. However, a flare-up in cases and consequent restrictions can spoil the market mood.

That apart, investors will track the pace of vaccination in the country. While most states have started the vaccination for 18-45 years old, the shortages of jabs have slowed down the pace of inoculation. With Russia's Sputnik is likely to hit the market this week and a dozen states having floated global tenders, it remains to be seen if there would be any improvement going ahead.

Investors would also eye the Wholesale Price Index-based inflation data to be announced on Monday.

Lastly, FII flows, crude price movement and the rupee's trajectory versus the dollar could also influence market trajectory.

And now, let's take a look at the trade setup for today.

Asian shares edged cautiously higher on Monday catching the tailwind from a bounce on Wall Street and ahead of what are expected to be upbeat readings on the Chinese economy, though any disappointment could quickly chill the mood.

MSCI's broadest index of Asia-Pacific shares outside Japan firmed 0.2%, nudging further away from a four-month trough hit last week. Japan's Nikkei gained 0.4%, having also touched its lowest since early January last week. S&P 500 futures and Nasdaq futures were both flat, following Friday's rally.

Indian markets, meanwhile, eyed a strong start to the week amid a further fall in Covid cases with SGX Nifty ruling 74 points higher at 14,784 around 7.30 am.

A look at the stock-specific triggers that are likely to guide the market today.

Bharti Airtel, Federal Bank, Colgate-Palmolive and Orient Cement are among 24 companies that are slated to post their March quarter results today.

Engineering and construction giant Larsen & Toubro (L&T) reported a 11.3 per cent YoY rise in consolidated net profit at Rs 3,820.16 crore for March quarter 2020-21 on the back of higher revenue from operations.

Route Mobile (UK), a wholly-owned subsidiary of Route Mobile Ltd, on Sunday said it has appointed John Owen as the chief executive officer (CEO) of its Europe and Americas operations.

Hester Biosciences on Sunday said it has tied up with the Gujarat government to explore the production of the Covid-19 vaccine through technology transfer from Bharat Biotech. The Ahmedabad-based firm said it has already initiated discussions with Bharat Biotech in this regard.

Reflecting the buoyancy in the markets, brokerage Geojit Financial Services has nearly doubled its net profit at Rs 36.8 crore for the quarter to March, up 95 per cent from Rs 18.8 crore a year ago, when the market was ravaged by the pandemic last year.

Punjab National Bank on Saturday said it has raised Rs 1,800 crore by selling 53 crore shares on a private placement basis to investors like LIC and Societe Generale. Eligible Qualified Institutional Buyers were given the share at an issue price of Rs 33.75 per unit aggregating to Rs 1,799.99 crore, PNB said.

Hero MotoCorp on Friday said it will resume partial operations at its three plants at Gurugram and Dharuhera in Haryana and Haridwar in Uttarakhand from May 17.