Market Ahead Podcast, July 28: Top factors that could guide markets today

The bulls and bears are likely to remain at loggerheads once again as the global setup remains mixed, with stock-specific action expected to be high amid earnings announcement. Back home, indices look set to open higher as SGX Nifty was last seen up 40 points at 15,782 around 7.20 am. 

Elevated volatility in the run up to Thursday's F&O expiry cannot be ruled out while focus will remain on pharma names after the bear hammering in last session. Furthermore, US Fed meet, FII flow trends and IMF's downgrade on growth projections can also sway markets.

Citing the impact from the Covid second wave, the International Monetary Fund (IMF) on Tuesday slashed India's growth projection from 12.5 per cent to 9.5 per cent for fiscal 2021-22. The projection aligns with RBI's growth forecast for the current financial year.

Meanwhile, in overnight trade, US stocks fell, ending a five-day winning streak in the three major indexes, as investors were cautious before results from top tech and internet names and Wednesday's Federal Reserve announcement. The Dow Jones Industrial Average fell 0.24 per cent, the S&P 500 lost 0.47 per cent and the Nasdaq Composite dropped 1.21 per cent.

In Asia, most indices tracked a weak Wall Street finish to open in the red. Japan's Topix index fell 0.5 per cent and Australia’s S&P/ASX 200 lost 0.1 per cent although Hong Kong's Hang Seng was up 1.45 per 

Now, a look at the stock-specific triggers that are likely to guide the market today.

Over 60 companies, including Maruti Suzuki India, Nestle India, Birlasoft, Central Bank of India, Geojit Financial Services, Route Mobile, Tata Coffee, TCI Express, United Breweries and UTI Asset Management Company will release their quarterly numbers later today. 

A low base last year and  continued demand for in-home consumption products like Maggi, Kitkat, Nescafe is likely to drive Nestle India's growth in the June quarter (Q2FY21), believe analysts. In year-on-year (YoY) terms, the company is expected to post a 14-19 per cent jump in profit after tax (PAT) and 13-21 per cent increase in revenues.

As for Maruti, analysts believe the company may be able to guard the dent on revenue during the June quarter, owing to sequential rise in average selling prices, price hike taken during the quarter, and better product mix. On the revenue front, analysts estimate the income to rise in the range of 340 to 353 per cent year-on-year (YoY) but decline 22 to 25 per cent QoQ. The standalone net profit could be anywhere between Rs 787 crore and Rs 987.7 crore as against a loss last year. 

IndiGo posted its highest ever quarterly loss of Rs 3,174.17 crore during the April-June period as the second wave of the pandemic during April and May forced down the number of air passengers. Adding to this, the airline’s condition was worsened by crude oil prices have inched up, which means operating costs increase for airlines. 

IndusInd Bank reported doubling of its net profit to Rs 1,016 crore in the June 2021 quarter, on a dip in provisioning and a surge in other income. The bank had posted a net profit of Rs 510.39 crore in the corresponding quarter of the previous financial year.

Private sector Karnataka Bank reported a nearly 46 per cent fall in net profit at Rs 106.08 crore for the quarter ended June 2021, mainly on account of decreased treasury income. The lender's net profit stood at Rs 196.38 crore in the year-ago period.

Lastly, in the primary market, the initial public offer (IPO) by Rolex Rings will open for subscription today. The issue, with a price band at Rs 880-900 per share, looks to raise over Rs 700 crore. Ahead of the share sale, the company on Tuesday collected a little over Rs 219 crore from anchor investors. 

Meanwhile, Glenmark Life Sciences was subscribed 2.8 times on Tuesday, the first day of the issue. The wealthy investor portion was subscribed 88 per cent, and the retail portion was subscribed 5.3 times. The IPO closes on Thursday.