Market Ahead Podcast, May 10: Top factors that could guide markets today

The domestic equity market momentum continued for the second week in a row, although the trajectory was volatile and range-bound, and analysts expect this trend to continue this week as well in the absence of any fresh triggers.

Covid-19 updates, financial results and macro-economic data will continue to steer stock markets in this holiday-shortened week. Furthermore, global cues and the pace of vaccination will also influence market mood.

This week, a total of 165 companies are slated to post their March quarter numbers, including some of the prominent names like Asian Paints, Jindal Steel, Lupin, Voltas, Cipla, Dr Reddy's, Escorts, L&T and Vedanta.

Analysts believe the Q4 earnings season has been the silver lining so far as it has progressed well, but earnings downgrades are now rising, given the widespread restrictions in various states amid a strong second Covid wave, and it is the biggest risk factor for the markets.

India has been reporting over 4 lakh cases for the past few days while on Sunday, the daily cases dropped as 3,66,902 fresh infections were detected in the country. Various states have imposed stricter lockdowns, a move that could impact the economy. At the same time, the pace of vaccination is being keenly watched out for which has been off to a slow start amid shortages of jabs.

Going ahead, the interplay of the resurgence in Covid-19 cases and the pace of vaccination would decide the market direction.

That apart, investors will be eyeing macroeconomic data i.e. IIP and CPI inflation which is to be released on May 12 and WPI Inflation that is slated to be out on May 14.

Lastly, the pace of FII flows, oil price movement and rupee's trajectory will also sway market moves.

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

Asian stocks and US equity futures climbed after the S&P 500 hit a record on weak jobs data that added to the case for ongoing stimulus. Japan’s Topix index advanced 1.1%, Australia’s S&P/ASX 200 Index rose 1.1% and South Korea’s Kospi index added 1%.

Back home too, there were indications of a gap-up start amid a strong global setup. At 7.30 am, SGX Nifty was ruling 120 points higher at 14,988.

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

Twenty-two firms are slated to post their March quarter numbers today such as Chambal Fertilizers & Chemicals, Venky's, JMC Projects and Zydus Wellness

Avenue Supermarts, which owns and operates retail chain D-Mart, on Saturday reported an increase of 52.56 per cent YoY in its consolidated net profit to Rs 413.87 crore for the fourth quarter ended March 2021.

UltraTech Cement on Friday reported a 45.2 per cent YoY decline in consolidated net profit to Rs 1,774.13 crore for the fourth quarter ended March 2021 on account of reversal of deferred tax liabilities.

Hero MotoCorp said it has extended the shutdown at its manufacturing facilities across India, global parts centre and R&D facility in Jaipur till May 16. This is the third extension of the shutdown by Hero MotoCorp.

Maruti Suzuki India has also extended the maintenance shutdown till May 16, keeping in view the current pandemic situation.

Tata Power Board will consider issuing NCDs, bonds and other debt securities on a private placement basis on May 12.