The benchmark BSE Sensex closed at a five-month high from the opening low on Friday, May 12.
Stock market will be influenced by FII movement, Q4 final round earnings and global cues next week
After reaching a five-month high on Friday, the BSE Sensex is going to start the new week on Monday. This week the markets will be guided by FII momentum, the last round of Q4 earnings and global cues. Furthermore, the effect of Karnataka Election results are also being seen.
Santosh Meena, Head (Research), Swastik Investmart Ltd. said, “Congress has emerged as a clear winner as a result of the recently concluded Karnataka elections. While this may have an emotional negative impact on the market, the outcome for the most part has already been decided by investors. Therefore, it is unlikely that we will see a significant reaction from the market in response to this development.
He also said that the market will be influenced by FII movement, the last round of Q4 earnings and global cues next week.
“The Indian stock market has regained its bullish momentum after a one-week hiatus driven by strong inflows from foreign institutional investors (FIIs). FIIs have been net buyers for ten consecutive trading sessions, and their sustained momentum is likely to remain an important factor influencing the market direction in the coming days.”
Meena also said that as we enter the final leg of Q4 earnings, investors will closely monitor State Bank of India (SBI) results, which are expected to be a key driver of sentiment. Additionally, following the Karnataka election results, the impact of key economic indicators like Consumer Price Index (CPI) and Index of Industrial Production (IIP) numbers will also be closely watched early next week.
“Global cues are relatively subdued, but market participants will watch the direction of US markets, bond yields and dollar index, which could potentially impact Indian equities,” he said.
Nifty has been showing a consistent uptrend since April, successfully crossing the important resistance level of 18,200. Currently, the key resistance level is at 18,440, which represents a 78.6 percent retracement of the previous decline from 18,888 to 16,828.
While some profit-taking is likely around this level, a break above it could potentially propel it towards 18,630-18,690 range. On the downside, immediate support lies at the 9-day moving average (DMA) of 18,200, followed by the 20-DMA at 18,000, cluster of 100 and 200-DMA at 17,800, which will act as important support levels . during any improvement.
On Friday, May 12, the benchmark BSE Sensex recovered from the opening low to close at a five-month high led by gains in banking and auto stocks. The 30-share index closed 123.38 points, or 0.20 per cent, higher at 62,027.90, its highest level since December 12, 2022.
The broader NSE Nifty settled 17.80 points, or 0.1 per cent, higher at 18,314.80. The 50-stock index is up 245.8 points on a weekly basis, marking its third straight week of gains.
