However, as the week progressed, favorable vaccine-related updates and supportive global markets capped the damage. On the sector front, pharma and metal ended with healthy gains whereas all the other indices traded subdued wherein realty, FMCG and auto were the top losers.
On the data front, core sector data will be unveiled on April 30. The recent proposal by US President Joe Biden to raise capital gains tax has started showing its impact in US markets which may cascade this week. Needless to say, COVID-related updates will remain on the participants’ radar.
“We do not see volatility easing out this week too, thanks to scheduled data and events. The monthly expiry of April month derivatives contracts will keep traders on their toes,” said Ajit Mishra, VP Research. Religare Broking.
Here are key factors that may guide the market during the week:
Q4 earnings: A number of large and small companies will publish their March quarter earnings during the quarter, which will lead to individual stock actions. Prominent among them are HDFC Life Insurance, SBI Cards, Tech Mahindra, Axis Bank, Bajaj Finance, Britannia, HDFC AMC, Nippon AMC, Maruti Suzuki, TVS Motor, Biocon, Tata Communications, Bajaj Auto, Inox Leisure, Titan, IndusInd Bank, Marico and Reliance Industries.
Devastating pandemic: The Covid-19 pandemic is worsening day by day as lack of oxygen in hospitals is taking more and more lives. The country has been reporting over 3 lakh Covid cases everyday, a record for any nation in the world. Traders will keep an eye on the evolving situation to shift their trades.
On the other hand, all adults will be able to register for vaccination during the week. The pace of vaccination will be eyed by investors.
F&O expiry: The April futures and options contracts will expire on Thursday. There could be heightened volatility due to settlements of trade. It will also be interesting to watch how many traders rollover their positions.
Macro data: The government will release March month Infrastructure Output, which may lead to some stock specific movement in the sector. Besides, the Reserve Bank of India will also release forex data for the week ended April 23.
Rupee decline: Another worry of Indian investors is the sharp decline in rupee. The central bank was said to be providing dollars to prevent the USDINR pair from rising unilaterally, and their intervention helped the pair to pull back to 75.00 from the peak of 75.32.
“On the downside, 74.90-74.80 might act as immediate support levels. But if the same negative sentiments prevail in the market, then we may witness a downfall till 74.60-74.50 in the upcoming sessions. On the upside, 75.20-75.30 zone might be tested as resistance,” said Kshitij Purohit, Product Manager Currency and Commodity, CapitalVia Global.
Technical outlook: Nifty50 closed negative on the weekly chart and is now consolidating at a crucial support level. The index is trading outside its major rising channel, so bulls need to protect the current support as any break below the same can trigger a bearish sentiment throughout the market, said analysts.
“Many major stocks are showing signs of trend continuation on the upside and BankNifty index is also forming a sort of minor bottom around its short-term averages on a weekly timeframe. We suggest traders maintain a mild bullish to sideways bias on the market and keep tight stoploss just below the market support,” said Nirali Shah, Head of Equity Research, Samco Securities.
