Stock Market trading guide: Global trends, FPIs trading activity to drive markets in holiday-shortened week

Stock market On Monday: Domestic equity markets may remain volatile next week amid fear that the Federal Reserve will keep raising interest rates to tame inflation, analysts said, adding that the market would be mainly driven by global trends and foreign fund trading activity in the holiday-shortened week.

The BSE and the National Stock Exchange have listed March 7 (Tuesday) as a holiday on account of Holi. However, stock brokers' association ANMI has urged the government, exchanges and Sebi to shift the holiday to March 8 from March 7.

Pravesh Gour, Senior Technical Analyst, Swastika Investmart, said that the rising US bond yields and macroeconomic numbers will keep the market mood subdued in the near-term. 

"Investments by FIIs, who are turning out to be small net buyers at the margin, and DIIs will be monitored," he said. 

On the global front, the Bank of Japan will decide on interest rates and the US macroeconomic data (US nonfarm payrolls and unemployment rate) will be scheduled for release on March 10, while on the domestic front, India's industrial production data will also be unveiled on March 10, Gour added.

Industrial production data for the month of January will be released post-market hours on Friday. 

Market investors will also keep track of the movement of the rupee against the US dollar and Brent crude oil.

"This week is a holiday-shortened one and we expect volatility to remain high citing mixed indications. On the data front, participants will be eyeing the IIP data scheduled on March 10. Besides, the performance of global indices, especially the US markets, will be in focus for cues," said Ajit Mishra, VP - Technical Research, Religare Broking Ltd.

Markets remained highly volatile last week but managed to end higher amid a sharp rebound on Friday. The BSE Sensex rallied 899.62 points or 1.53 per cent to end at 59,808.97 on Friday. The NSE Nifty advanced 272.45 points or 1.57 per cent to settle at 17,594.35.

On the technical front, Nagaraj Shetti, technical research analyst, HDFC Securities, said that Nifty witnessed an excellent comeback on Friday and closed the day with decent gains of around 272 points or 1.57 per cent at 17,594.35.

"A long bull candle was formed on the daily chart, which is indicating an upside breakout of the consolidation movement of last few sessions. Friday's move seems to have confirmed the lower bottom reversal at 17255 on 28th February, of the larger negative pattern of lower tops and bottoms. Presently, Nifty is in an attempt of staging upside breakout of the initial hurdle at 17600 levels and a move above this area could open the next upside resistance of around 17800 levels in the near term," he said.

Nifty on the weekly chart formed a reasonable bullish candle with a minor lower shadow, he said, adding that the formation of a such pattern after the sharp weakness of the previous week signals chances of an upside bounce for the market ahead. Immediate support is placed at 17450 levels.

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