Week Ahead : Mood likely to be cautious at higher levels

Last Updated: Sun, May 18, 2014 07:45 hrs

After last week's historic surge, the mood on the Indian bourses will be somewhat cautious for in the coming week, with investors awaiting the formation of the Union Cabinet.

The next major trigger for the market will be the Reserve Bank of India's monetary policy. As it is still more than a couple of weeks away, movements are likely to be mostly sideways, with a few strong rounds of buying and selling now and then.

Of course, there will some stock specific news with a few top notch companies slated to announce their quarterly reports. FMCG heavyweight ITC and banking sector major State Bank of India will come out their earnings reports towards the fag end of next week.

Reliance Power, Reliance Infrastructure, Aditya Birla Nuvo, AIA Engineering, Essar Oil, Uco Bank, Zee Entertainment Enterprises, Motherson Sumi and Sobha Developers will also be announcing their results next week.

With the NDA having swept to power with a clear mandate, one can expect some announcements on reforms in banking, retail, infrastructure and power sectors.

After focusing on developments on the domestic front since the middle of April, investors will start looking at the global economic scenario and the trend in global stock markets for some direction.

Some consolidation is likely in the market after the spectacular ride up north. There was a sample of sorts to this effect last Friday itself when the market plunged from its historic high in afternoon trade, with the Sensex plunging by around 1500 points from the day's high. Though it managed to bounce back and end in the possitve terrain, only a few front line stocks moved up significantly from the day's lows.

Bank, infrastructure, power and realty stocks are likely to remain in focus.