March F&O expiry, global cues, and FII flows among other factors for Dalal Street in holiday-shortened next week

Market Next Week: The Indian markets will mainly be influenced by monthly derivatives expiry along with global cues among other major factors in the holiday-shortened next week, several analysts estimate.

Besides, they also believe triggers like foreign investors flow, the rupee’s movement against the US dollar, and the Brent crude trend may dictate the equity markets in the coming week.

The domestic stock markets are expected to be shut on March 30, 2023, on account of Ram Navami – which is also termed the birthday of Lord Ram.

The coming week is a holiday-shortened one and we expect volatility to remain high due to the scheduled expiry of March month derivatives contracts, Ajit Mishra, VP - Technical Research, Religare Broking Ltd said in his quote for the market next week.

Besides, global cues, foreign flows, and movement in crude could further add to the choppiness of Indian equities, the analyst at Religare Broking said.

According to Mishra, foreign investors are on a selling spree and feeble global cues are further deteriorating the mood. Besides, we can see cracks across sectors, and a fresh decline in the broader indices may further dampen the sentiment, he noted.

Similarly, Santosh Meena, Head of Research, Swastika Investmart expects that the volatility may increase in the markets before the March F&O expiry, and the position of major international banks will continue to play a significant role in the direction of the market globally.

The market will also keep an eye on the geopolitical situation because there is still tension between Russia and Ukraine and some tension developing between the US and Syria, Meena added, stating the Indian market is not paying much attention to this.

US bond yields and the dollar index will also be significant determinants, even if the movement of crude oil prices is crucial, the analyst at Swastika Investmart further stated.

The markets remained under pressure for the third successive week and lost nearly a per cent. The benchmark indices – NSE Nifty50 and BSE Sensex – settled at 16,945 and 57,527 respectively.

Initially, weak global cues were weighing on the sentiment however rebound in select index majors eased some pressure in the middle; however, the tone again turned negative in the final sessions, tracking mixed signals from the US Fed and news of a hike in STT by the government, as per Mishra.