Markets may face volatility amid F&O expiry

Global factors and trading activity of foreign institutional investors are expected to guide domestic market sentiments this week, while equity benchmarks may face volatility amid monthly derivatives expiry, analysts said.

Indian markets have been witnessing volatile trades for the past several trading sessions. However, the Nifty managed to break its five-week losing streak and ended with a decent weekly gain of 3 per cent, said Santosh Meena, head of research, Swastika Investmart Ltd.

Inflation and slowdown in the global economy means stagflation is a key concern for the global equity markets, "therefore, we are seeing relentless selling by FIIs (Foreign Institutional Investors). However, Indian markets are in a better position due to support from domestic investors," he added.

"The market may remain volatile this week due to May month expiry. On the global front, minutes of the FOMC (Federal Open Market Committee) meeting will be released on 25th May, which will be an important trigger, while movement of the dollar index and commodity prices will be other important factors," Meena said.

Yesha Shah, head of equity research, Samco Securities, said, "The volatility observed last week is expected to continue considering major economic data releases, the current earnings season and the monthly expiry. The FOMC minutes, US GDP growth rate forecasts and initial jobless claims will all influence global market sentiment."

Last week, the Sensex climbed 1,532.77 points or 2.90 per cent, while the Nifty jumped 484 points or 3.06 per cent.