Market Ahead, March 15: Top factors that could guide markets this week

The benchmark indices ended the highly volatile session last week nearly 1% higher with Nifty50 settling above the psychologically important 15,000 mark. This week, Indian markets will be guided by the US Federal Reserve's call on interest rates and domestic macroeconomic data. Besides, Covid-related news will also remain on investors' radar.

First and foremost, the markets would react to macroeconomic data viz IIP and CPI inflation, which came in after market hours on Friday. In a double whammy for the economy, industrial production growth re-entered the negative territory by contracting 1.6 per cent in January, while retail inflation soared to a three-month high of 5.03 per cent in February on costlier food items. The WPI inflation is scheduled to be released on March 15.

Next, markets would keep a close watch on the US bond yields which have become a headache for equity markets of late. The 10-year US Treasuries yield stood at 1.638% in early Monday trade, having risen to as high as 1.642% on Friday, a high last seen in February last year.

Amid this backdrop, the upcoming US Fed's plans to tackle the volatility in the bond yields will be keenly eyed by market participants. The Fed meeting is slated for March 16-17.

Besides, rising yields, a flare-up in crude prices is another worry for markets. After rising to $71 barrel last week, Brent crude is hovering in the range of $69-70 a barrel amid output cuts from major producers and optimism about global economic recovery. Oil prices will continue to be closely watched as India is one of the biggest oil importers in the world.

That apart, the latest spike in Covid cases in India threatens India's economic recovery. India on Sunday reported 25,317 new Covid-19 cases, the highest since December 19 with Maharashtra as the hotbed. While vaccination drive is gathering pace, recent concerns around AstraZeneca vaccine in the Europe and suspension of its use remains a concern.

Lastly, investors would also keep a close watch on FII flows and rupee trajectory this week. So, far in March, FIIs have pulled out over Rs 7,000 crore from Indian markets.

Meanwhile, action in the primary market will also remain high with five new issues, looking to raise Rs 3,700 crore are set to open this week. Craftsman Automation and Laxmi Organics Industries will launch their IPOs on Monday while Kalyan Jewellers India will open on Tuesday. IPOs of Suryoday Small Finance Bank and Nazara Technologies will begin on Wednesday. Besides, Anupam Rasayan's IPO, which got fully subscribed on Friday, the first day of issue, will close on Wednesday.

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

Global stock prices were off to a solid start while US bond yields hovered near a 13-month peak on Monday as investors bet US economic growth will accelerate after the passing of a massive stimulus package.

U.S. S&P500 futures rose 0.25% in early Asian trade, trading just below a record high level touched last week, while Japan's Topix index rose 0.7%. Australia’s S&P/ASX 200 Index was flat and Hong Kong’s Hang Seng Index added 0.5%.

Tracking the upbeat global mood, SGX Nifty was trading 0.65 per cent higher at 15,123, indicating a firm start for benchmark indices back home.

On the stock-specific front, shares of MTAR Technologies will be in focus as they would debut on the bourses today.

SBI Card board has approved raising up to Rs 2,000 crore by issuing bonds.

ONGC, which is often perceived as a drag on the crude oil and natural gas produced in the country, has actually seen its contribution to the national production jump to over 70 per cent from under 53 per cent a decade back, petroleum ministry data showed.

NMDC on Friday said its board has approved an interim dividend of Rs 7.76 per share for the current financial year.

Jindal Steel and Power reported an 18 per cent jump in its crude steel output to 6.53 lakh tonnes (LT) in February this year. The company had produced 5.54 LT steel in February 2020, JSPL said in a statement.