Sensex, Nifty week ahead: Key factors to guide market this week – Mint

Indian stock markets were supported by factors such as the Reserve Bank of India’s (RBI) liquidity announcements, corporate earnings, global cues in the first week of May which helped boost the investor sentiment, even as India continued to record over 4 lakh new covid cases on a daily basis.

The BSE Sensex rose 256.7 points or 0.5% to close at 49,206.47 on Friday, whereas, the Nifty 50 ended the session at 14,823, up 98 points or 0.67%. Steel and metal stocks continued to shine during the week. Midcap and smallcap stocks also outperformed. For the week, benchmark indices gained nearly 1% each.

Foreign investors continue to be the net sellers amid India’s covid surge as depositories data showed that FPIs pulled out 9,659 crore on net basis from the equity markets in April while they withdrew 5,936 crore in the first week of May.

Key factors to watch out in the week ahead:

Covid updates: The country on Sunday reported over 4 lakh new covid cases for the fifth consecutive day. As many as 4,03,738 more people tested positive for Covid-19 in the last 24 hours, with 4,092 more people succumbing to the disease, said the Union health ministry on Sunday morning.

Various states have imposed or extended lockdowns for another few weeks to control the rise in the cases which could impact the economy. Therefore, Covid-related updates and lockdown related news would be keenly watched along with the pace of the vaccination drive.

Earnings: Major companies like Asian Paints, Larsen & Toubro Jindal Steel & Power Limited, Lupin, Vedanta, Cipla and Dr Reddy’s Laboratories’ will release their March quarter results next week.

Tata Power, Voltas, Escorts, Apollo Tyres, Equitas Holdings are also scheduled to release their quarterly earnings in the week ahead.

Macro economic data: Economic data like the IIP (Index of industrial production) and inflation data will be released in the coming week.

The IIP along with inflation data will be released on Wednesday, whereas the WPI inflation updates will be released on Friday.

Technical view: Sameet Chavan of Angel Broking said that all key indices like Nifty, Nifty Bank and Nifty IT are trapped in a slender range. ”As far as higher levels are concerned for Nifty, 14900 – 14960 – 15050 are the levels to watch out for; whereas on the flip side, 14750 – 14600 – 14450 are to be considered as immediate supports.”

Chavan said that the broader market is not short of actions. ‘’One of the notable observations is the development in ‘Nifty Midcap’ index. In the latter half of the week, it has managed to surpass the higher boundary of the cluster of resistance by a small margin. Couple of follow up moves in this basket would provide the real impetus for the next leg of the rally,’’ he added.

Covid-19 updates, financial results, macro-economic data, global trends are some of the factors expected to guide the market sentiment this week, say analysts. They also expect that favorable vaccine-related updates, supportive global markets may act as positive support. Indian equity markets will remain closed on Thursday on account of ‘Id-Ul-Fitr’.

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