Market Ahead, March 16: Top factors that could guide markets this week

The newsflow regarding the novel coronavirus will continue to be the number one trigger for the markets this week as investors await further stimulus measures by global central banks and governments.

The number of novel coronavirus cases rose to 110 in India, with 12 fresh cases reported in Maharashtra on Sunday. The virus has infected more than 150,000 people worldwide and killed over 5,600.

In order to cushion the effect of the rapidly escalating global pandemic, the US Federal Reserve cut interest rates to near-zero on Sunday in another emergency move to help shore up the US economy. The central bank said it was cutting rates to a target range of 0 per cent to 0.25 per cent. The US Fed also said it would expand its balance sheet by at least $700 billion in the coming weeks. 

However, the US Fed's latest action did little to allay investor fears as the US stock futures hit their down limit before daybreak in Singapore. Japan's Nikkei was down 0.3 per cent in early trade and Hong Kong slipped over 2 per cent while Austrlia's ASX tumbled over 6 per cent. Even the SGX Nifty was down over 300 points, indicating a subdued start for Sensex and Nifty today.

Last week, the S&P BSE Sensex lost 3,473 points to close at 34,103, while the Nifty50 index plunged 1,034 points to 9,955. Analysts said that equity markets are likely to see more volatility this week while the overall trend remains negative.

According to a Business Standard report, the Securities and Exchange Board of India is working on a plan to arrest the deep market sell-off and reduce volatility. A ban on short selling, mandatory delivery-based trading, and invoking the so-called additional surveillance mechanism for highly volatile stocks are among the proposals being considered, the report said.

Another key event today would be the highly awaited listing of the SBI Cards and Payment Services on the bourses, although experts say that the deep sell-off in the markets in the last few days might dampen the expectations of a blockbuster listing.

On the macroeconomic front, investors will track the WPI inflation data which is scheduled to be announced later in the day.

YES Bank is likely to remain in focus today after it reported its December quarter results during the weekend after weeks of delay. The private lender reported a net loss of Rs 18,564.24 crore for the Q3FY20, as against a net profit of Rs 1,000.57 crore in the corresponding period of FY19.

This apart, investors will also track foreign fund flow, oil price movement, and the Rupee's trajectory. FIIs have already sold Rs 30,334 crore in March so far, contributing heavily to the sell-off. Meanwhile, oil prices extended losses on Monday, slumping by more than $1 a barrel. Brent crude fell $1.83 to $32.02 a barrel.