Stock market outlook: Key factors to watch next week

Mumbai, Sep 7 (IANS) The coming week is expected to be crucial for Indian stock markets, with tariffs, inflation data, foreign institutional investor (FII) activity, and key global economic indicators likely to guide market direction.

On September 12, the government will release retail inflation figures. Retail inflation stood at 1.55 per cent in July -- reflecting the pace at which prices of goods are rising and offering insights into demand and supply conditions in the economy.

According to media reports, US President Donald Trump has signed an executive order granting tariff exemptions to trade partners that have entered industrial export agreements.

Starting Monday, key materials such as nickel, gold, pharmaceutical compounds, and chemicals will be exempt from tariffs.

Additionally, the US is set to release its inflation and jobless claims data next week, which could influence global markets.

The previous week was positive for Indian equities. The Nifty surged 314.15 points, or 1.29 per cent, to close at 24,741, while the Sensex advanced 901.11 points, or 1.13 per cent, to end at 80,710.76.

Between September 1 and 5, sectoral indices such as Nifty Auto (up 5.45 per cent), Nifty Metal (up 5.75 per cent), Nifty Energy (up 1.96 per cent), Nifty PSU Bank (up 1.47 per cent), Nifty Commodity (up 2.52 per cent), and Nifty Consumption (up 2.58 per cent) emerged as top gainers.

The only laggard was the Nifty IT index, which slipped 1.55 per cent.

FIIs continued their selling spree last week, offloading equities worth Rs 5,666.90 crore, while domestic institutional investors (DIIs) provided support with net purchases of Rs 13,444.09 crore.

Commenting on market trends, Sudeep Shah of SBI Securities, said Nifty witnessed significant volatility last week with gap-up or gap-down openings in all five sessions.

However, on a weekly basis, the index looks bullish. According to him, the resistance zone for Nifty lies between 24,950–25,000, while support is expected in the 24,550–24,500 range.

Ajit Mishra of Religare Broking Limited also said that the Nifty rebounded from a low of 24,400, slightly above the previous swing low of 24,337.5, but continues to consolidate within a triangle pattern marked by lower highs at 25,153.65 (August 21) and 24,980.75 (September 4).

“A decisive breakout above 25,000 could trigger fresh momentum, taking the index toward 25,250 and then 25,400,” Mishra added.

--IANS

pk