The Indian stock market is poised for a positive start this week after a rough ride last Friday, when benchmark indices logged their worst intraday performance of the year. With key global and domestic indicators shaping investor sentiment, the focus now shifts to upcoming economic data and geopolitical developments.
Markets Brace for a Volatile Week
Stock market participants are gearing up for a potentially volatile week as a mix of economic data, political decisions, and foreign fund flows influence trading patterns. On Friday, the Sensex plummeted by 1,414 points (-1.90%) to close at 73,198.10, while the Nifty 50 sank 420 points (-1.86%) to settle at 22,124.70. The sell-off extended February’s downtrend, making it the fifth consecutive month of decline for Nifty 50, which has lost almost 6% during the period.
Market experts remain cautious, citing weak global cues and limited domestic triggers. “The ongoing weakness in global markets, coupled with lack of fresh domestic catalysts, could keep equities under pressure,” said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services Ltd.
Asian Markets Off to a Mixed Start
Monday’s early trade showed mixed signals across Asian markets. Japan’s Nikkei rose by 1.1%, while the broader Topix index gained 1.12%. However, Hong Kong’s Hang Seng index pointed to a lower opening, and South Korean markets remained closed for a public holiday. MSCI’s broadest index of Asia-Pacific shares outside Japan was largely flat, reflecting investor caution.
Uncertainty over trade policies, particularly the prospect of fresh tariffs from the United States, has kept markets jittery. This adds another layer of complexity for investors balancing global economic uncertainties with domestic market conditions.
Gift Nifty Indicates Positive Opening
Pre-market indicators suggest a rebound for Indian stocks. The Gift Nifty was trading around 22,365, marking a premium of nearly 85 points over the Nifty futures’ last close. This signals a potential recovery when the markets open on Monday.
“Given the deep cuts we saw last week, a minor pullback was expected,” said a Mumbai-based fund manager. “However, sustainability of gains will depend on factors like foreign fund inflows, corporate earnings, and upcoming macroeconomic data.”
Key Global Market Triggers This Week
Investors are closely watching major global developments that could impact market trends:
- U.S. Stock Market Performance: Wall Street ended higher last Friday, led by a strong performance in technology stocks. Nasdaq gained 1.7%, while the S&P 500 climbed 1.2%.
- Donald Trump’s Tariff Announcements: The former U.S. president is expected to unveil a set of trade tariffs, which could affect global trade flows.
- China’s Economic Data: Industrial output and consumer spending data from China will provide further insights into Asia’s largest economy.
- Crude Oil Prices: Brent crude hovered around $83 per barrel, with price movements expected to influence inflation trends worldwide.
Domestic Economic Indicators to Watch
On the domestic front, investors will focus on key economic and corporate data points:
- India’s GDP Growth: Recent data showed India’s GDP expanded at 8.4% in Q3 FY25, exceeding expectations. This could boost sentiment if sustained.
- Auto Sales Data: Monthly vehicle sales numbers will indicate demand trends in the automobile sector.
- Rupee vs. Dollar Movement: Currency fluctuations remain critical, especially amid shifting foreign investor flows.
Bitcoin and Crypto Market Trends
The cryptocurrency market has remained resilient despite regulatory headwinds. Bitcoin was trading above $61,000, showing signs of stability after recent volatility. While Indian markets have limited direct exposure to crypto, global sentiment around digital assets can influence risk appetite in broader financial markets.
With a mix of global cues, economic data, and domestic stock triggers in play, Indian markets are set for an eventful week ahead. Traders and investors will need to tread carefully as they assess the risks and opportunities unfolding in real time.
