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Indian markets remained under pressure as surge in Covid cases and restrictions in certain states dented investor sentiment. Indian indices fell for the third consecutive week as the country has been recording the most number of new infections in the world. India has seen over three lakh Covid cases reported for five days in a row.

The BSE Sensex slipped 202 points or 0.42% to close the week at 47,878.45, while the Nifty closing at 14,341.35, down 64.80 points or 0.45% on Friday. Realty, FMCG, IT stocks were the top draggers during the week whereas banks, metals and select pharma stocks were trying to support the market. For the week, Sensex and Nifty shed nearly 2% each. The benchmark indices are poised to see the worst monthly fall since May 2020.

Analysts expect the nervousness to continue. ''We do not see the volatility easing out in the coming week too, thanks to scheduled data and events,'' Ajit Mishra, VP Research of Religare Broking said.

Sameet Chavan of Angel Broking said that markets are completely clueless which way to move in the near term. Facing some pressure at higher levels as the battle continues with respect to the pandemic and on the lower side; bulls are clearly not willing to give up, he added.

Here are the key factors to watch out for the next week -

Covid cases: India is currently recording the most number of new infections in the world. The country has seen over three lakh cases for five days in a row now. India reported nearly 3.5 lakh cases in the last 24 hours, the Union Health ministry said on Sunday.

On the other hand, Delhi government extended the covid-induced lockdown for another week till May 3. Therefore, Covid-related updates and restrictions from states would be keenly watched next week.

Earnings: Major companies like Axis Bank, Maruti, Bajaj Auto, Hindustan Unilever and IndusInd Bank will announce their numbers this week. Tech Mahindra, Bajaj Finance, Hindustan Zinc, Titan Company and Reliance Industries are also scheduled to release their quarterly financial results in the coming week.

Vinod Nair of Geojit Financial Services said that movement will be stock-specific based on Q4 results and dictated by developments on the covid spread, like falling infection rate.

Global cues: The US Federal Reserve monetary policy and the Gross domestic Product (GDP) data of the US would influence the global stock market in near term. The Fed will conclude its two-day meeting on Wednesday.

Global markets would also be impacted on the news of likely hike in capital gains tax in the US. A Bloomberg report stated that President Joe Biden will propose almost doubling the capital gains tax rate for wealthy individuals.

Technical view: Angel Broking said that despite Nifty still holding on to a key support zone of 14200 – 14150, they continue to advocate caution till the time some important levels are not surpassed.

‘’For Nifty, the immediate resistance zone can be seen around 14575 – 14650, where a sustainable move beyond 14650 would negate the possibility of further correction to resume the upward trajectory,’’ Sameet Chavan of Angel Broking said.

‘’We reiterate our view that the prevailing sideways bias in Nifty would end below 14,100 and it may slip towards the 13,800 zone. In the case of a rebound, 14,600 would act as a crucial hurdle. We feel it’s prudent to stay with defensive names and see how the markets pan out in the coming week,’’ Mishra said.

However, analysts believe that favorable vaccine-related updates, supportive global markets and lockdown could invoke hopes of economic recovery in the near future.

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