Market Ahead Podcast, May 24: Top factors that could guide markets today

The benchmark indices ended a two-month-long consolidation phase as they gained over 3% last week. This week, the market is likely to be guided by updates on the Covid-19, March quarter earnings as well as global trends, say analysts. Volatility is expected to remain high due to the scheduled derivatives expiry of May month contracts.

The quarterly earnings season will come to a close this week, with 390 companies slated to post their quarterly scoreboard. Some of the top names on the list include Grasim, Eicher Motors, Mahindra & Mahindra, BPCL, Sun Pharma and Divis Laboratories.

Covid-19, meanwhile, will remain the biggest driving factor for the equity market this week. The stock market bulls, last week, were enthused by the signs of coronavirus cases peaking out in the country. But what remains to be seen is if the trend continues as the pace of the vaccination drive remains an overhang.

India for the second consecutive day on Monday reported cases below the 2.5 lakh mark with 2.22 lakh cases. On Sunday, the fresh caseload stood at 2.4 lakh. Amid a drop in cases, a few states have hinted at the possibility of easing lockdown from next month onwards.

The pace of vaccination although is worrying amid shortages of jabs even as a third vaccine -- Sputnik V -- has been added to the inoculation list. Amid a crunch, a few states have suspended vaccination drive for citizens aged 18-45.

That apart, buying and selling by institutional buyers may also sway market moves. Overseas investors withdrew Rs 4,444 crore from Indian markets in May so far amid concerns over the second wave of the coronavirus pandemic and its possible impact on the Indian economy. Although DIIs have pumped in Rs 2,209.72 this month.

Lastly, oil price movement, rupee's trajectory and global market cues will further guide market mood.

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

Asian shares got off to a cautious start on Monday as investors anxiously awaited a key read on US inflation this week for guidance on monetary policy. MSCI's broadest index of Asia-Pacific shares outside Japan was barely changed in slow trade. Japan's Nikkei added 0.1% while South Korea's Kospi shed 0.18% and Hong Kong's Hang Seng 0.22%.

Tracking a cautious global market setup, SGX Nifty was down 53 points at 15,172 around 7.30 am.

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

Grasim Industries, India Cements, JK Paper, Mahanagar Gas and Barbeque-Nation Hospitality are among 33 companies slated to post their quarterly numbers today.

JSW Steel on Friday posted a manifold jump in its consolidated net profit to Rs 4,191 crore for the quarter ended March 31, mainly on account of higher income.

Hero MotoCorp on Saturday said it will resume production at all its manufacturing plants in India from coming Monday after temporarily shutting operations due to the coronavirus pandemic.

Punjab & Sind Bank reported a net profit of Rs 160.79 crore in the last quarter of the fiscal ended March 2021. The state-run lender had posted a net loss of Rs 236.30 crore in the same quarter of the preceding fiscal year.

Leading commodity bourse MCX posted a 41.31 per cent YoY drop in its consolidated net profit at Rs 38.44 crore during the fourth quarter of 2020-21 fiscal on poor income.