Market Next Week: Strong FIIs inflows, higher industrial earnings, solid corporate growth drive markets

Indian equities continued their upward trajectory for the third consecutive week, with both the Nifty 50 and Sensex logging gains of over 1%. The rally was fueled by sustained foreign institutional investor (FII) inflows, solid corporate earnings, and upbeat industrial production data. The Nifty ended the week at 24,346.70, and the Sensex closed at 80,501.99.

Despite a strong start, benchmark indices traded within a narrow band for most of the week. Broader markets, however, showed signs of fatigue—BSE Midcap rose by 0.4%, while the Smallcap index dipped 1.3% week-on-week, according to SBI Securities.

What Drove the Market This Week?

The markets were buoyed by India’s industrial output, which rose 3% in March, signaling steady economic momentum. Positive global cues, especially from stable U.S. markets amid ongoing bilateral trade discussions, further supported sentiment. The Reserve Bank of India (RBI) also struck an optimistic tone about India’s economic outlook, underlining the resilience of the domestic economy.

Ajit Mishra, SVP of Research at Religare Broking, highlighted sectoral strength in Realty, Auto, IT, Pharma, and Energy, while Media, FMCG, and Metal stocks faced selling pressure. The broader market saw mixed movement amid intra-week volatility.

What to Watch Next Week

Several domestic and global events will shape the market’s direction in the coming week:

Key Domestic Triggers:

HSBC Composite and Services PMI Final (April)

Quarterly earnings from marquee companies like M&M, Coal India, Asian Paints, Titan, L&T, Coforge, Paytm (One 97 Communications), Pidilite, and Dr. Reddy’s Laboratories.

Market reaction to SBI and Kotak Mahindra Bank Q4 results (released over the weekend)

Key Global Triggers:

U.S. Fed Interest Rate Decision (7 May)

S&P Global Services PMI (U.S.)

U.S. Balance of Trade (March)

Initial Jobless Claims Data

Investors will also keep an eye on any geopolitical developments and updates on international trade and tariff discussions.

Technical Outlook: Is a Pause Ahead?

Mishra noted that the Nifty remained range-bound between 24,000 and 24,600, showing signs of possible consolidation after a sharp rally. A sustained break above 24,400 could propel it toward 24,800, while a dip below 23,800 may trigger profit-taking, with strong support around 23,400.

For Bank Nifty, consolidation is expected in the 52,800–53,700 range. However, any further dip is likely to attract buying interest, with upside potential toward 55,500–57,000.

Trading Strategy: Cautious Optimism

Mishra recommends a "buy on dips" approach with a preference for hedged positions to manage near-term volatility. He also emphasized selective stock picking, focusing on sectors showing relative strength and favorable risk-reward setups.

Disclaimer: T Please consult a certified financial advisor before making investment decisions.