Market Ahead, April 5: Key Factors That Could Drive Markets This Week

After two consecutive weeks of decline, markets rebounded strongly and gained more than 2%, during the week shortened by the holidays.

This week, markets are expected to focus on RBI policy results, macroeconomic data and development on the Covid front. Global indices should also guide the trajectory of the market. That aside, analysts believe, the markets could see some consolidation ahead of the earnings season which begins in mid-April.

First, the markets could react to the rapid increase in Covid cases in the country and particularly in Maharashtra, following which the state government announced weekend shutdowns there and on Sunday. a nighttime curfew to control the spread of the virus. India, for the first time since the outbreak of Covid last year, recorded more than 1 lakh of cases on Sunday.

Given the rapid increase in cases in the country, investors will focus on the results of the RBI’s policy slated for April 7. Expectations are ripe for the RBI to maintain its rates and its accommodative stance, however, comments on inflation and economic growth outlook will be key.

In addition, macroeconomically, investors are reportedly keeping an eye on March manufacturing PMI data to be released later today, while March Markit Composite and Services PMIs will be released on Wednesday.

In addition, the movement of oil prices, FII flows and the trajectory of the rupee will also influence the direction of the market.

Finally, on the primary market front, an initial public offering (IPO) from Macrotech Developers (formerly known as Lodha Developers) will be open for subscriptions from April 7 to 9 while the shares of Barbeque Nation Hospitality are expected to be listed on April 7.

And now, let’s take a look at today’s business setup.

Defying positive global market sentiment, domestic markets appeared poised to start the week on a moderate note, scared by the rapid increase in Covid cases in the country. SGX Nifty futures traded down 0.50% at 14,918 around 7:40 am today.

On the global front, Asian stocks and US futures rallied on Monday as investors weighed in on a surprisingly strong report on US employment and the sustainability of the latest massive bond sale.

Japan’s Nikkei rose 0.8% while the MSCI’s largest Asia-Pacific stock index outside of Japan was nearly flat. The Australian and Chinese markets were closed.

On the specific equity front, shares of Tata Motors will be the center of attention after the company said it finalized the sale of its defense business to Tata Advanced Systems for an initial consideration of Rs 227.7 crore.

Britannia Industries has declared an interim dividend of Rs 62 per share and the registration date has been set for April 10, 2021.

Jaiprakash Power Ventures, as part of its efforts to reduce its debt, prepaid its loans in the amount of Rs 299.51 crore.

V-Mart Retail opened six new stores – four in Uttar Pradesh, one in Bihar and one in Rajasthan.

National Fertilizers reported the highest ever total fertilizer sale of 59.36 lakh MT in fiscal year 21. In addition to fertilizers, the company also saw strong growth in sales of seeds and agrochemicals.

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