Market may be cautious ahead of FOMC, GST meet; Maruti, DRL eyed

The market is likely to be cautious ahead of few key June quarter earnings. The clock is ticking for the much awaited goods and services bill in the Parliament. All eyes will be on a crucial meeting on GST between state finance ministers today. Global market also will be keenly watching decisions taken in the Federal Reserve monetary policy meeting that starts today.

The two-day Federal Open Market Committee's (FOMC) monetary policy meeting is not expected to make any change in interest rates but may provide hints on timing of its next interest rate hike. Though markets see almost no chance of a hike by the Fed but are wary in case it acknowledges a recent improvement in US economic data in a way that adds to the risk of a move later in the year.

Foreign funds have been flowing into Indian shores taking the Nifty above the 8600-mark. Foreign institutional investors bought Rs 891 crore in cash market yesterday FIIs bought Rs 7,330 crore over 12 consecutive sessions. DII sold only Rs 68 crore yesterday.  

On Monday, the 50-share Nifty hit a 52-week high of 8641.15 intra-day before ending at 8635.65, up 94.45 points or 1.11 percent. The 30-share BSE Sensex rallied 292.10 points or 1.05 percent to close at 28095.34.

In important earnings today, auto major Maruti is expected to report a slowdown in volume growth this quarter on account of production loss due to fire at its vendors plant while TVS Motor may report double digit growth on account of good demand in scooter segment.

Dr Reddy's is expected to report a subdued Q1 quarter as pricing pressure in US and lower sales from Venezuela, Russia are expected to weigh on its performance. Zee Entertainment may report a decent quarter as its ad revenue growth is seen between 15 to 17 percent in Q1.

Cement majors ACC and Ambuja will announce Q1 earnings today. 

Global cuesAmong global markets, Asian markets slipped sending the safe-haven yen higher ahead of central bank meetings in the United States and Japan, while a fresh skid in oil dampened energy stocks on Wall Street.

Japan's Nikkei shed 1 percent, with investors seemingly unimpressed by a Nikkei report the government planned a direct fiscal stimulus of around 6 trillion yen (USD 56 billion) over the next few years.

US stocks receded from record highs on Monday as oil weighed on energy shares and investors awaited an avalanche of quarterly reports.

Oil prices edged away from three-month lows, supported by a weaker dollar, but concerns of ongoing oversupply weighed on markets and many traders are raising their bets on further price falls.

The dollar slipped ahead of the FOMC meet while the yen gained on hopes that the Bank of Japan will ease later this week. Gold pares losses as the dollar and global stock markets turned lower.