Key Market Drivers Next Week: WPI Inflation, US Fed Rate, and FII Activity
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Synopsis
The market outlook for the upcoming week is shaped by various factors including WPI inflation in India, activities of FIIs, and the US Fed's interest rate decision. The recent downturn in indices and sector performances raise concerns, while investor sentiment remains cautious amid global uncertainties.
Key Takeaways
- WPI Inflation in India will impact market sentiment.
- FIIs recorded significant net outflows.
- Sector performance varied, with IT leading declines.
- Market closed on March 14 for Holi.
- Key support and resistance levels for Nifty identified.
Mumbai, March 16 (NationPress) The market perspective for the upcoming week will be influenced by both global and Indian factors, including India's WPI Inflation, the activities of Foreign Institutional Investors (FIIs), the US Fed interest rate decision, initial jobless claims in the US, among others.
From March 10-13, the Nifty index decreased by 147.50 points, equating to a 0.65 percent drop, settling at 22,397.20, while the Sensex experienced a decline of 511.18 points or 0.69 percent, landing at 73,828.91.
The market was shut on March 14 in observance of Holi.
Both midcaps and small caps faced significant selling pressure compared to large caps. The Nifty Midcap 100 index saw a fall of 1,223 points or 2.48 percent, closing at 48,125.10, whereas the Nifty Smallcap 100 index dropped 503 points or 3.27 percent, to end at 14,897.35.
Sector-wise, the IT index was the most affected, followed by banking and new-age sectors.
Global market sentiment remained fraught with uncertainty, particularly due to concerns surrounding US President Donald Trump's tariff policies.
This ambiguity led investors to take a more cautious stance, resulting in a lackluster trading session.
Worries over ongoing FII outflows and the possible impacts of US tariffs on Indian companies further undermined market confidence, increasing uncertainty regarding Q4 earnings.
FIIs recorded a net outflow of Rs 5,729 crore in the cash segment, while Domestic Institutional Investors (DIIs) injected Rs 5,499 crore, offering some degree of stability to the market.
Puneet Singhania, Director at Master Trust Group, stated, "The Nifty closed in the negative this week and is currently positioned above its 100-week Exponential Moving Average (EMA), which is near 22,000, while remaining below the 21-day EMA. Immediate support is at 22,300, and breaching this level may trigger further selling toward 22,000."
"On the upside, 22,630 represents a significant resistance level, and a breakout beyond this point could lead to a rise towards 22,800. A bearish outlook continues to prevail unless the index firmly closes above its 21-day EMA," he added.
