The upcoming week is expected to see rangebound market movement, with investors focusing on key central bank meetings, including the U.S. Federal Reserve (FOMC), Bank of England (BoE), and Bank of Japan (BoJ). Other critical factors include developments in the global trade war and China’s retail sales and industrial production data.
Market Recap & Outlook
The market ended the truncated week on March 13 with a 0.7% decline, following a strong rally the previous week. Concerns over the escalating trade war and a potential U.S. recession weighed on sentiment. However, losses were limited by easing CPI inflation, better than-expected industrial output, favorable oil prices, and a subdued U.S. dollar index.
- Nifty 50 fell 155 points to close at 22,397
- BSE Sensex dropped 504 points to 73,829
- Broader markets saw sharper declines, with Nifty Midcap 100 and Smallcap 250 down 2.2% and 3.5%, respectively
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services, expects rangebound movement with volatility and sector rotation. Vinod Nair, Head of Research at Geojit Financial Services, noted that uncertainties around global trade and a U.S. recession could influence market momentum. However, falling crude oil prices, a weaker dollar, and expectations of a domestic earnings rebound could help stabilize the market.
10 Key Factors to Watch This Week
1. Federal Reserve Interest Rate Decision
- The FOMC policy meeting on March 19 is the key event.
- The Fed is expected to hold rates at 4.25–4.50%.
- Fed Chair Jerome Powell’s commentary on jobs, inflation, and future rate cuts will be closely watched.
- The U.S. dollar index has fallen 6% from its January high, reflecting recession fears and policy uncertainty.
2. Bank of England and Bank of Japan Rate Decisions
- BoE (March 20): Expected to keep rates at 4.5%.
- BoJ (March 19): Likely to maintain its 0.5% policy rate.
3. Global Economic Data
- China’s retail sales & industrial production are key for gauging economic growth.
- U.S. retail sales and industrial production are important for the global demand outlook.
- Eurozone and Japan inflation numbers will influence monetary policy expectations.
4. Oil & Gold Prices
- Brent crude: closed at $70.58 per barrel, rebounding slightly after recent losses.
- Oil remains bearish, trading below key moving averages with RSI & MACD signaling weakness.
- Gold: Surged 2.99% last week, closing at $3,001.1 per ounce, supported by safe-haven demand amid economic and geopolitical risks.
5. Domestic Economic Data
- WPI inflation & trade balance (March 17): Inflation expected to rise slightly from 2.31% in January.
- Forex reserves (March 21): increased by $15.26 billion to $653.97 billion last week.
6. Foreign Institutional Investor (FII) Flows
- FIIs net sold₹5,729.7 crore in Indian equities last week, bringing total March outflows to₹21,231 crore.
- However, DIIs (Domestic Institutional Investors) bought ₹5,500 crore, partially offsetting FII selling.
7. IPO Market Action
- Two SME IPOs launching:
- Paradeep Parivahan (March 17): ₹45 crore
- Divine Hira Jewellers (March 17): ₹32 crore
- Upcoming SME listings:
- PDP Shipping & Projects (March 18)
- Super Iron Foundry (March 19)
8. Technical View
- Nifty 50 trading range: Expected between 22,250 and 22,700.
- Key levels:
- Resistance at 23,000
- Support at 22,000
- The index remains bearish, trading below key EMAs (5, 10, 20, 50-week) with negative momentum indicators.
9. F&O Cues
- Nifty 50 options range: 22,000–23,000.
- Key resistance levels:
- Maximum Call open interest: $23,000 strike
- Significant Call writing: 22,700 & 23,000 strikes
- Key support levels:
- Maximum Put open interest: $22,000 strike
- Significant Put writing: 21,500 & 22,400 strikes
- India VIX (Volatility Index) fell 1.4% to 13.28, extending its decline for the fourth straight week, favoring bullish sentiment.
Market Summary
The upcoming week will likely see rangebound trading with volatility driven by global cues. Key central bank decisions, U.S. economic data, oil prices, and FII flows will play a crucial role in shaping market direction.
