Stock markets are expected to witness volatile trading sessions in the holiday-shortened week ahead, with investor sentiment to be guided by developments around the Covid-19 crisis, analysts said.
Markets would get a leg up if the lockdown is partially lifted in the country and economic activities resume, they added.
The nationwide lockdown looks set to be extended till April-end after a consensus emerged at a meeting between chief ministers and Prime Minister Narendra Modi on Saturday for continuing the curbs.
However, the Prime Minister also announced a shift in focus from 'Jaan hai to jahaan hai' (health is wealth) to 'Jaan bhi, jahaan bhi' (lives as well as livelihoods), which many saw as an indication that the lockdown may be relaxed in some areas.
Equity markets would remain closed on Tuesday for 'Dr Babasaheb Ambedkar Jayanti'.
Stocks had rallied last week amid reports that the Centre was readying a second stimulus package to boost growth.
"This uptrend seems to be a short-term bear market rally and may not be sustainable. In India, there is expectation that the worst affected sectors and MSMEs may get some relief in another package to be announced shortly.
"Markets will continue to fluctuate based on news coming out regarding the spread of infections and any lifting of lockdown in India," Vinod Nair, Head of Research, Geojit Financial Services said.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, said: "Investors are worried that the lockdown in the country could be extended considering the rising cases in India. Thus, market would continue to remain volatile with swing on either side as it would track global developments around the trend in coronavirus cases and stimulus. So, any update on the national lockdown would impact the markets either ways."
Among macroeconomic data, inflation rate for March is due on Monday, while WPI inflation will be announced on Tuesday.
According to SAMCO Securities & StockNote, Founder & CEO, Jimeet Modi, "Any negative surprises with respect to the lockdown will also have an impact on bourses."
The death toll due to the novel coronavirus rose to 273 and the number of cases to 8,356 in the country on Sunday, according to the Union Health Ministry.
Globally, more than 1.7 million people have been infected, with over 103,000 deaths.
During the past week, the Sensex rallied 3,568.67 points or 12.93 per cent.