Indian stock markets are likely to remain volatile next week as investors track foreign institutional investor (FII) flows, crude oil price movements, Nvidia's quarterly earnings and changing interest rate expectations.
MUMBAI — Indian stock markets are likely to remain volatile next week as investors track foreign institutional investor (FII) flows, crude oil price movements, Nvidia's quarterly earnings and changing interest rate expectations.
After a spectacular rally that pushed the Sensex and Nifty higher for 10 consecutive sessions, benchmark indices witnessed some profit booking towards the end of last week. However, sustained foreign inflows and resilient corporate earnings helped markets retain their weekly gains.
The Sensex declined 319 points to close at 81,592 on Friday (November 13), while the Nifty slipped over 155 points to settle at 25,144, snapping a three-session winning streak.
The correction came amid renewed concerns over global AI-related trade, rising crude oil prices and expectations of tighter monetary policy following a sharper-than-expected increase in domestic inflation.
One of the biggest factors influencing market sentiment next week will be the continuation of FII buying. Foreign investors remained net buyers of Indian equities for the tenth consecutive session on Friday, purchasing shares worth Rs 5,736.55 crore, according to provisional NSE data.
Crude oil prices will also remain on investors' radar as geopolitical developments in the Middle East continue to create uncertainty over global energy supplies.
While comments from US President Donald Trump suggesting that the Iran war was effectively over initially eased concerns and triggered a decline in oil prices, fresh attacks on Saudi energy infrastructure and disruptions to shipping through the Strait of Hormuz led to a rebound.
Brent crude is currently hovering near $96 per barrel. Any further rise in oil prices could weigh on India's macroeconomic outlook, inflation and corporate margins, while a sustained decline may support market sentiment.
Global technology stocks will also be in focus as investors await Nvidia's quarterly earnings announcement scheduled for Tuesday (November 17).
The chipmaker's results and management commentary could influence sentiment around the global artificial intelligence trade.
Any sharp movement in AI-related stocks may have an impact on Indian equities, particularly technology shares, as investors assess the implications for global growth and the competitive positioning of Indian IT companies.
Meanwhile, rising inflation has brought interest rate expectations back into focus. India's retail inflation accelerated to 6.09 per cent in October from 5.54 per cent in September, breaching the Reserve Bank of India's upper tolerance limit of 6 per cent.
The latest reading has strengthened concerns about the possibility of monetary tightening, with several economists anticipating a potential rate hike at the RBI's December policy meeting. Market participants will closely assess the implications of higher inflation for borrowing costs, liquidity and economic growth.