Market Wrap-Up: Nifty and Sensex Rebound
After a two-week losing streak, the Indian equity indices—Nifty50 and Sensex—bounced back, ending the week in positive territory. Nifty finished the week up by 1%, while on Friday, it posted an impressive 400-point gain, closing at 24,541. This rally was fueled by strong U.S. economic data, easing inflation in India, and stability in the Japanese yen, according to Palka Arora Chopra, Director at Master Capital Services.
Factors to Watch This Week
U.S. Markets and Global Cues
Global trends, particularly those from the U.S., will continue to be a significant influence. Last week, the U.S. markets showed robust performance, with the S&P 500, Dow Jones, and Nasdaq Composite all registering gains due to lower inflation numbers in the U.S. This positive momentum could impact Indian markets as well.
Rupee vs. Dollar
The Indian rupee experienced slight fluctuations last week, closing just 1 paisa lower at 83.95 against the U.S. dollar on Friday. Geopolitical tensions in the Middle East, particularly between Israel and Iran, are expected to keep the rupee under pressure. Analysts predict the rupee will trade within a range of Rs 83.75 to Rs 84.25 against the dollar in the upcoming week.
Corporate Actions
Several major companies, including Hindustan Aeronautics Limited (HAL), Reliance Industries (RIL), and ONGC, are set to approach their record dates for dividend payouts, bonus issues, and stock splits. These corporate actions will likely draw attention and impact market movements.
Technical Outlook: Cautious Optimism
Rajesh Bhosale, an Equity Technical Analyst at Angel One, noted that recent sessions have established a base around the key support level of the 50-Day EMA. The Nifty has also broken out of a congestion zone and closed above the 20-Day EMA, signaling potential for further gains. However, Bhosale warned that a bullish gap around 24,200 is critical; if this gap is breached, the market could retrace to lower levels of 24,000 or 23,900.
FII/DII Activity
Foreign Institutional Investors (FIIs) were net buyers last Friday, with purchases amounting to Rs 766.52 crore. Domestic Institutional Investors (DIIs) were also net buyers, investing Rs 2,606.18 crore. Their continued activity will be a key factor to watch in the coming week.
As the markets reopen, all eyes will be on these factors to gauge the direction of Nifty and the broader market.