Dalal Street Week Ahead: Key Factors to Monitor Include Strait of Hormuz Tensions, Iran Peace Talks Progress, Q4 Earnings, Oil Prices, and FII Flow

Indian Equity Benchmarks Maintain Uptrend Despite Global Volatility

Indian equity benchmarks continued their uptrend, forming a higher high–higher low pattern for the second consecutive week ended April 17, despite volatility driven by West Asia tensions, fluctuations in oil prices, and March quarter earnings.

The strengthening rupee against the US dollar, valuation comfort, and a recovery in FII flows also boosted market sentiment. The IMF raised India's FY27 GDP growth forecast to 6.5 percent from the previously projected 6.4 percent, even as it flagged global recession risks, highlighting India's macroeconomic resilience.

Market Direction in the Coming Week

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On Monday, the market will first react to HDFC Bank and ICICI Bank's quarterly numbers, as well as the closure of the Strait of Hormuz and hope of second round of peace talks before ceasefire deadline of April 22. Going ahead, market direction in the coming week is expected to be driven by progress in peace talks, developments in the Strait of Hormuz, crude oil prices, FII sentiment, and March quarter earnings.

Key Performance Indicators

The broader markets outperformed the benchmark indices, with the Nifty Midcap 100 and Smallcap 100 indices gaining 3.55 percent and 4.3 percent, respectively.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Factors to Watch

Strait of Hormuz and peace talks will be key factors to watch, particularly for their impact on oil prices. Equities are likely to consolidate at higher levels next week after a sharp 10 percent rally over the past ten trading sessions.

Global Economic Data and Monetary Policy

On the global front, US retail sales, pending home sales, weekly jobless claims, and Michigan inflation expectations will be closely tracked by the market participants globally for further signals on consumer resilience, alongside flash PMI readings from major global economies. Fed Chair Kevin Warsh's congressional testimony scheduled on April 21 will also be watched for early signals on the direction of US monetary policy.

March Quarter Earnings and Domestic Economic Data

Back home, the focus will remain on further set of quarterly earnings scheduled next week. More than 90 companies will release their quarterly numbers in the next six days, including Nifty 50 names like Reliance Industries, Infosys, and HCL Technologies.

Economic releases like infrastructure output for March scheduled on April 20, HSBC Manufacturing & Services PMI Flash numbers for current month on April 23, and foreign exchange reserves for week ended April 17 will also be watched.

FII Flow and Indian Rupee

The focus will also be on the mood at the Foreign Institutional Investors' (FIIs) desk as they provided sigh of relief in the recent week due to buying in last three straight sessions. The Indian rupee will also be watched as the currency remained range-bound for last couple of weeks.

IPO Action

The IPO action has not seen strong revival action yet, though the market sentiment has been improving for last couple of weeks. Leapfrog Engineering Services, from the SME segment, will be the only IPO hitting Dalal Street next week on April 23.

Technical View and F&O Cues

Technically, the momentum in the near term remains in favor of bulls with the RSI climbing to over 57 and the MACD reaching closer to zero line with expansion in histogram green bar. The Nifty 50 needs to convincingly break above 24,400, the recent week's high, for a sharp upmove toward 24,700-24,800.