Tuesday, the Indian market may open flat with a negative bias mirroring weak global cues. There could be some stock-specific buying in reaction to March quarter earnings announcements, but the market may show volatility due to the expiry of April series derivative contracts on Wednesday. Intra-day profit taking may also cap big gains.

On Monday, foreign institutional investors bought shares worth Rs.257.38 crore on a net basis, while domestic institutional investors purchased shares worth Rs.68.06 crore, data released by the Bombay Stock Exchange showed. On Friday, FIIs pumped in a net Rs.513.50 crore in Indian equities, according to market regulator SEBI data.

Currently, markets across the Asia-Pacific region are trading mostly lower. China's Shanghai Composite index is down 0.69%, Hong Kong's Hang Seng index is declining 0.45%, Japan's Nikkei 225 index is losing 0.15% and South Korea's KOSPI is down 0.78%, but Australia's All Ordinaries index is up 0.58%.

Overnight, concerns over the economic impact of the swine flu kept Wall Street in negative terrain for the major part of the session on Monday. While Hugh Johnson, chief investment officer for Johnson Illington Advisors told RTTNews that traders used the swine flu scare as an excuse to take some money off the table, he warned that a full blown epidemic could lead to a 10 to 15 percent correction.

Although the flu does seem to be spreading, many doctors agree that the swine flu is no more panic worthy than any other breakout of the human flu during flu season. The Dow Jones Industrial Average closed down 0.64%, the Nasdaq Composite fell 0.88% and the S&P 500 declined 1.01%.

The Indian ADRs closed mixed. HDFC Bank closed down 0.69%, Satyam fell 0.54%, Sterlite Industries declined 1.1% and Infosys moved down 0.76%, but Wipro rose 0.44%, ICICI Bank gained 2.05%. MTNL advanced 2.11% and Reddy's Laboratories added 2.4%.

The rupee closed Monday's session lower at Rs.50.26 against the dollar, down 45 paisa from the previous close, weighed down by increased dollar demand from importers and choppiness in the stock market.

On Monday, the benchmark for the Indian market, the Sensex closed a volatile session modestly up, led by strong gains in the banking and capital goods sectors. While the Sensex closed at 11,372, up 43 points or 0.38% over the previous close, the S&P CNX Nifty fell 11 points or 0.31% to 3,470. Volatility ruled the roost as traders rolled over their positions ahead of the April series derivatives contract on Wednesday.

Stocks to Watch

MindTree could be in focus after it has reported a 55.5% fall in its net profit for the 12 months to March. Cipla may extend its gains on reports that it has stocked up inventory of the antidote Tamiflu, to meet any emergency demand arising from the outbreak of swine flu.

Tech Mahindra may be in focus after it has announced a profit in the March quarter compared to a loss in the corresponding period a year ago.

Glenmark Pharmaceuticals could move after it has received tentative approval from the US Food and Drug Administration to sell the generic version of Schering-Plough and MSP Singapore Company LLC's cholesterol-lowering drug, Zetia (Ezetimibe).

Private sector banks such as ICICI and HDFC Bank could be in the spotlight amid reports that the government could reverse the new FDI guidelines for the banking sector to avoid classifying a few private sector banks as foreign-owned entities.

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