Week Ahead: F&O expiry, US tariffs, FII flow, global cues among key triggers for Indian stock market

The Indian stock market staged a strong rebound fueled by improving investor sentiment, improving foreign flows, and positive global cues. Bulls were back in action with renewed buying interest across counters, setting calls for further uptrend before the closing of the financial year 2024-25.

Next, investors will monitor some key market triggers in the last week of the current fiscal (FY25). The expiry of March derivatives contracts, Donald Trump‘s tariff announcements, foreign fund inflow, domestic and global macroeconomic data, and global market cues will dictate the market direction in the last week of March, marking the final developments of FY25.

Domestic equity benchmarks Sensex and Nifty 50 extended their winning streaks for five straight days, with the NSE 50 index logging its best week in over four years, driven by bargain hunting and foreign capital.

Also Read: Nifty ‘heavily overbought’ after 900-point surge, says Sanjeevv Agarwwal of Alpha Quanntum: Time to book profits?

The NSE Nifty 50 gained 0.69 per cent on Friday to close at 23,350.4, while the BSE Sensex rose 0.73 per cent to 76,905.51, both six-week closing highs. The frontline indices rose about 4.2 per cent during the week.

The broader midcaps and small-caps soared 7.7 per cent and 8.6 per cent, respectively, to register their biggest weekly gains in about five years. The Indian rupee logged its best week in more than two years. The Nifty 50 is still down about 11 per cent from its record high. In the five-day stock rally, equity investors have become richer by ₹22.12 lakh crore.

The market’s uptrend was primarily driven by technical buying and value accumulation from key demand zones rather than any major fundamental shifts. However, concerns over global macroeconomic headwinds and trade tariffs persist,” said Puneet Singhania, Director at Master Trust Group.

This week, the primary market will witness a subdued trend with a few new initial public offerings (IPO), and listings slated across the mainboard and small and medium enterprises (SME) segments. The week will be critical from the domestic and technical points of view. Investors will track domestic and global macroeconomic data, along with fiscal-end developments.

Here are the key triggers for the Indian stock market in the coming week:

4 new IPOs, 5 new listings to hit D-Street

In the mainboard segment, no new issues have been listed so far to open for subscription this week. In the SME segment, four new issues will open for subscription. Among listings, shares of five SMEs will get listed on either BSE SME or NSE SME.

FII Activity

Foreign institutional investors (FIIs) turned net buyers, capitalizing on attractive valuations and fueling the market’s momentum. FIIs recorded a net inflow of ₹5,819 crore in the cash segment, while domestic institutional investors (DIIs) injected ₹4,337.80 crore, further supporting the market’s rally.

“Recent activity shows a change in FII strategy in India. After relentless selling, FIIs turned buyers during a few days last week with a big buy figure of ₹3,255 crore through the exchanges on March 21. The intensity of selling had started declining earlier,” said Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investment Services.

Also Read: Crude oil logs biggest weekly gain since January on US sanctions, OPEC+ group cuts: Brent gains over 2% in five days

The total amount of FII selling from March through March 21 stood at ₹31718 crore. The trend of FII buying debt continued, with a total debt investment of ₹10,955 crore from March through March 21st.

“The recent reversal in FII selling improved market sentiments, facilitating a rally in the market for the week. It can be argued that positive domestic fundamentals like pick up in growth and decline in inflation coupled with weakness in the dollar have contributed to the change in FII strategy,” added Dr VK Vijayakumar.

Global Cues

On the global front, the US markets will be closely watched, with tariff-related updates and GDP growth data expected to influence investor sentiment. Although US markets saw a temporary respite after a sharp decline, mixed signals suggest potential volatility in the coming sessions.

The US House Price Index for January, which measures month-over-month changes in average prices of single-family houses, will be released on March 25. The UK inflation rate for February will be released on March 26.

Also Read: US Fed holds benchmark rate steady at 4.25-4.50%, signals two reductions in 2025: 5 key highlights

“US policymakers acknowledged rising economic uncertainties but reiterated their expectation of a 50-basis-point rate cut this year, in line with December projections,” said Puneet Singhania of Master Trust Group.

The US GDP growth rate Q4, to be released on March 27, will reflect the economy’s performance following recent US Federal Reserve policy decisions and offer insights into whether growth aligns with shifting monetary conditions.

The upcoming US PCE and Core PCE data releases will be closely watched, as they are critical in shaping US Fed policy outlooks and have far-reaching implications. The UK GDP data for Q4 is scheduled for release on March 28.

Corporate Action

Shares of TVS Motor, Samvardhana Motherson, REC, Mishra Dhatu Nigam Ltd, among others, will trade ex-dividend next week, starting from Monday, March 24. Shares of some stocks will also trade ex-bonus. Check full list here

Technical View

From a technical perspective, Nifty 50’s recent breakout from the 22,250-22,650 range has propelled it to a crucial resistance level of around 23,400. A decisive move beyond this level could set the stage for further gains. Read full technical analysis here

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts, consider individual risk tolerance, and conduct thorough research before making investment decisions, as market conditions can change rapidly, and individual circumstances may vary.