Q4 results, global cues to dictate market trend coming week, say analysts - know technical outlook

Quarterly earnings and global trends would be the major driving factors for the equity markets this week as trading resumes after a long holiday, said analysts.

The Russia-Ukraine war and the COVID-19 situation in China would be monitored for further cues, they added.

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"As earnings season gathers pace, D-Street will be eyeing quarterly results to gauge future trajectory of market.

"As no major global or domestic macroeconomic events are expected this week, stock-specific movements will be more pronounced and whipsaw movements can be witnessed as a result of earnings hits and misses," said Yesha Shah, Head of Equity Research, Samco Securities.

WPI inflation for March is scheduled to be announced on Monday.

Ajit Mishra, VP - Research, Religare Broking Ltd, said, the markets will react to two major earnings -- Infosys and HDFC Bank -- on Monday.

India's second-largest software services firm Infosys last week posted a 12 per cent year-on-year increase in consolidated net profit for the March quarter at Rs 5,686 crore, as it projected 13-15 per cent revenue growth for FY23 on the back of a "strong demand environment" and "robust deal pipeline".

The country's largest private sector lender HDFC Bank on Saturday reported a 22.8 per cent jump in its standalone net profit at Rs 10,055.2 crore for the quarter ended March 2022.

Besides, MindTree, ACC, HCL Technologies, Nestle and Hindustan Zinc would announce their earnings this week.

"With the start of earnings season, domestic market is also likely to be buoyed by sector-specific momentum in the coming days," said Vinod Nair, Head of Research at Geojit Financial Services.

In the holiday-truncated last week, the Sensex tumbled 1,108.25 points or 1.86 per cent, while the Nifty lost 308.70 or 1.73 per cent.

Markets would also track foreign institutional investors' investment trend, and movement of rupee and Brent crude, experts added.

Technical Outlook By Yesha Shah

Nifty 50 closed the week on a negative note taking cues from global indices and has closed just around its immediate support level of 17,450. On a weekly chart, the index has formed an evening star candlestick pattern, indicating bearishness.

After the highs of October 2021, a lower top lower bottom pattern has been forming on the benchmark index. The broader indices also have a similar trend and the overall structure of the market has been shifting to the bearish side.

A decisive fall below 17,450 levels can lead to a retest of 16,900 zone. Thus, traders should maintain a mild bearish outlook going into the next week. A move above the immediate resistance level of 17,850 can negate the bearish outlook.

(With PTI Inputs)