Factors that will guide the markets this week

Domestic quarterly earnings, global trends and foreign fund trading activity would dictate the movement in equity markets, which may face volatility amid the scheduled monthly derivatives expiry this week, analysts said.

Equity markets took a breather last week.

The BSE Sensex declined 298.22 points or 0.48 per cent and the Nifty dipped 111.4 points or 0.60 per cent.

"Global and domestic macroeconomic data, crude oil prices, global market trends, Foreign Institutional Investors (FIIs) and domestic institutional investors (DIIs) activity will be monitored this week.

"Earnings season will continue to be in focus with companies like BPCL, Ashok Leyland, NMDC, Hindalco, Oil India, LIC, Vodafone Idea, BHEL, ONGC, and many more will be declaring their results this week," Arvinder Singh Nanda, senior vice-president at Master Capital Services Ltd, said.

Globally, investors would continue to focus on the US debt ceiling negotiations, Nanda added.

US President Joe Biden's administration is reaching for a deal with Republicans as the nation faces a deadline as soon as June 1 to raise the country's borrowing limit, now at USD 31 trillion, to keep paying the nation's bills.

Domestic markets faced headwinds last week due to weak cues from the global markets, Vinod Nair, head of research at Geojit Financial Services, said.

Equity benchmark indices found firmer ground on Friday after a three-session losing streak amid a positive trend in global markets and unabated foreign fund inflows.

"We expect choppiness to remain high this week too due to the scheduled expiry of May month derivatives contracts.

"Meanwhile, global markets performance and consistency in the foreign fund flows will remain on the participants' radar for cues," Ajit Mishra, VP - Technical Research at Religare Broking Ltd, said.

Market participants are waiting for the release of the Federal Open Market Committee (FOMC) meeting minutes, scheduled for May 24, said Pravesh Gour, senior technical analyst at Swastika Investmart Ltd.

Over the near term, the markets may be expected to be volatile, led by stock-specific movements as the earnings season goes underway in full swing, Joseph Thomas, Head of Research at Emkay Wealth Management, said.