The Week Ahead in Equity Markets: Key Factors to Watch

The Indian equity markets fell marginally on May 16 amid uncertain global cues and weakening domestic stocks.

Nifty fell by 42 points, or 0.17% to close at 25,019, while the Sensex dipped by 200 points or 0.24% to settle at 82,330. Despite the fall, both the indices reported strong weekly gains of over 4%.

In the coming week, investors will be keeping tabs on domestic quarterly earnings and various economic indicators.

Indian stock market

In the previous week, the stock market closed with strong gains, buoyed by intense buying across various sectors and optimism in midcap stocks. Sensex and Nifty jumped 4% in the previous week, which is the best performance given by the indices in recent times.

Starting the week with strong gains, the indices witnessed a lull session in the mid-week, followed by a thumping rally in the final days. The Nifty and Sensex ended at 25,019.80 and 82,330.59, respectively.

“The week began with fireworks as the NIFTY index jumped over 900 points on Monday, driven by reports of a potential ceasefire and easing geopolitical tensions between India and Pakistan. Although the index saw some consolidation during the mid-week, Thursday delivered one of the most thrilling expiries in recent times. NIFTY decisively reclaimed the 25,000 mark — a level last seen in October 2024. For the week, the index gained over 4%, closing above 25,000 and signaling renewed bullish momentum.

Over the past few weeks, NIFTY has rallied nearly 3,300 points from the April 2025 low of 21,800 — a sharp uptrend with hardly any meaningful pullback. While FIIs have turned net buyers in the cash segment and geopolitical tensions with the neighbouring country have eased, there are a few technical observations that warrant attention,” said Mehul Kothari, Deputy Vice President — Technical Research at Anand Rathi.

Here’s a look at the key trends

Q4 earnings

Several companies are set to report their March quarter (Q4FY25) earnings this week. Noteworthy ones include Larsen & Toubro, Titan Company, Mahindra & Mahindra, Asian Paints, Bank of Baroda, BSE, Paytm, Swiggy, Tata Chemicals, MRF, Indian Hotels Company, Dr. Reddy's Laboratories, Reliance Power, Hindustan Petroleum Corporation, and Coforge.

IPO activity

Borana Weaves Limited and Belrise Industries Limited are set to come up with their IPOs in the next week. The street will also debut three new small and medium enterprise (SME) IPOs in the upcoming week.

FII activity

Foreign Institutional Investors (FIIs) have pumped in ₹23,778 crore as of May 16.

“FIIs who were sellers in the first three months of 2025 having sold equity for ₹116574 crores during this period turned buyers in April with buy figure of ₹4243 crores. This change in FII strategy from selling to buying accelerated in May with big buying of 23778 crores through 16th May. With the global trade scenario improving after the pause in trade war between US and China and the end of the India-Pak conflict, the investment scenario has improved. The growth prospects in US, China, Japan and the EU continues to be challenging while India is expected to clock a growth rate of above 6% in FY 26. Importantly, with inflation in India very much under control and the MPC expected to cut rates twice or thrice more in this rate cutting cycle, the macro construct in India looks good. Going forward, FIIs are likely to continue their buying in India. Therefore, large caps will be resilient,” said VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.

India-US trade deal

Investors are keeping a close watch on India-US trade deal as the outcome of the agreement is likely to impact the equities market and investor sentiments.

What do experts say?

Ajit Mishra – SVP, Research, Religare Broking Ltd said that breaking the three-week consolidation, the Nifty is expected to sustain its upward momentum.

“The index is now targeting levels of 25,200–25,600. On the downside, the earlier resistance at 24,800 is likely to act as immediate support, with a stronger support base at 24,400,” Mishra said.