This week, the direction of the equity markets will be heavily influenced by decisions from the US Federal Reserve, global economic trends, tariff-related news, and the activities of international investors, according to analysts. Key macroeconomic indicators, including the Wholesale Price Index (WPI) inflation data for February, are set to be released on Monday, adding to the market’s anticipation.
Global Economic Indicators Impacting Markets
Vinod Nair, the Head of Research at Geojit Financial Services, expressed that ongoing uncertainties in global trade and concerns over a potential US recession could continue to sway the domestic market’s performance. Despite these challenges, he noted that recent corrections have led to more favorable valuations.
Key supportive factors include:
- Declining crude oil prices
- A weakening dollar index
- Anticipations of a rebound in domestic earnings in upcoming quarters
These elements may help stabilize the market amidst the current trade uncertainties, potentially reducing volatility.
Insights on International Data Releases
Nair highlighted that this week’s economic data from China, particularly retail sales and industrial production, will be crucial for assessing the country’s growth trajectory. Investors will also keep a close eye on retail sales and production figures from the US, which could further influence market sentiment.
Another significant event this week is the Bank of England’s decision regarding interest rates, which will be closely monitored by market participants.
Market Performance and Investor Sentiment
Investor sentiment took a hit last week due to rising global trade tensions and fears surrounding a US economic downturn. The Nifty-50 index saw a decline of 0.7%, closing at 22,397, primarily driven by weak global cues linked to uncertainties in US trade policies.
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services, anticipates that the market will remain in a range-bound state with some fluctuations, influenced by global trends and evolving tariff policies in the US.
Weekly Market Recap
In a shortened trading week, the BSE Sensex fell by 503.67 points (0.67%) and the NSE Nifty dropped by 155.21 points (0.68%).
Prashanth Tapse, Senior VP of Research at Mehta Equities Ltd, pointed out that investor apprehension regarding potential tariffs on Indian goods by the Trump administration is likely to persist, leading to cautious trading with a negative bias for the time being.
As investors navigate these complex dynamics, staying informed about economic indicators and global events will be essential for making strategic decisions in the equity market this week.
