The domestic benchmarks, after hitting new peaks last week, are likely to see consolidation before charting a new rally. As almost all the companies across the sectors have reported their quarterly figures, which are largely in line or better than street expectations, there are no fresh triggers for the market, said analysts. Further opening of the economy by various state governments and the rapid vaccination programme also boosted sentiment, they added.
Besides, the undertone is likely to remain bullish, as the Government signalled its business-friendly stance last week by passing a Bill that seeks to do away with the contentious retrospective tax provision in the Lok Sabha, said analysts.
According to analysts, the market will be range-bound in negative territory on Monday. In the short-term, global markets will drive domestic sentiment, they said.
The SGX Nifty at 16,220 (8 am IST) signals a gap-down opening of about 30 points, as the Nifty futures closed at 16,251.70 on Friday. The US indices closed with a mixed tone on Friday, with the Dow and S&P 500 edging up and the Nasdaq slipping. The Asian markets, too, presented mixed signals in Japan, Australia and the Chinese markets, even as Korea and Taiwan edged down marginally.
Hemant Kanawala, Head – Equity, Kotak Mahindra Life Insurance Co. Ltd, said: “Globally, while sentiment was soured by the crackdown on Chinese edu-tech and rising cases of the delta variant of Covid, the domestic outlook remained supported due mainly to an improvement in the vaccination run-rate, a low national Covid case count and an earnings season that has been broadly in line with expectations.”
Over the last two weeks, the Nifty has been up 4 per cent, outperforming MSCI EM by 520 bps in USD terms. “The sectoral performance reflects the earnings, with metals outperforming the pack and autos and FMCG underperforming the pack. We expect the markets to sustain the momentum amid continued policy support from RBI, gains from the unlocking of the economy and a pick-up in the performance of the monsoon,” he added.
Results calendar
Astrazeneca Pharma India, Balrampur Chini Mills, Birla Tyres, Bombay Dyeing, Chemcon Speciality Chemicals, Clean Science and Technology, Gati, Gujarat State Petronet, Indian Hotels, Laxmi Organic Industries, MRF, Nilkamal, Reliance Power, Satin Creditcare Network, Shalby, Shankara Building Products, Shree Cement, Subex, Suven Life Sciences, Timken India and Venky's (India) will release quarterly earnings on August 9.