New Delhi: The Indian stock market is likely to remain volatile this week as investors closely track the Reserve Bank of India’s (RBI) policy decision, rising tensions in West Asia, and key global economic data.
RBI Policy in Focus
The RBI’s Monetary Policy Committee (MPC) meeting will be the biggest domestic trigger. Experts believe the central bank is likely to keep interest rates unchanged. However, investors will closely watch the RBI’s commentary on inflation, growth outlook, and future rate direction.
Rising crude oil prices due to geopolitical tensions have increased inflation concerns, while weak manufacturing data indicates slowing economic growth. This puts the RBI in a difficult position.
Global Cues & US Data
Global factors will also play a major role in market direction. Investors are awaiting key US economic data, including inflation (CPI), GDP figures, and jobless claims.
Strong US data could reduce hopes of interest rate cuts by the US Federal Reserve, strengthen the dollar, and put pressure on emerging markets like India.
West Asia Conflict Impact
The ongoing conflict in West Asia remains a major concern for markets. Any escalation could push crude oil prices higher and increase volatility. On the other hand, signs of peace or ceasefire could trigger a relief rally.
Markets are especially sensitive to weekend developments, as trading resumes after a gap.
Crude Oil, Rupee & FII Flows
Brent crude prices are hovering near USD 107 per barrel, keeping inflation worries high. At the same time, the Indian rupee has shown weakness, touching around Rs 93 per dollar before recovering slightly due to RBI intervention.
Foreign institutional investors (FIIs) have been heavy sellers. In March alone, they pulled out around Rs 1.2 lakh crore, one of the highest monthly outflows in recent years. This continues to weigh on market sentiment.
Market Performance & Outlook
Last week, the Sensex fell 0.35 percent while the Nifty declined 0.46 percent in a holiday-shortened session.
Analysts believe markets will remain volatile in the near term. Key triggers to watch include RBI policy decisions, crude oil movements, FII activity, and global economic data. Any easing in geopolitical tensions could bring relief, while further escalation may keep markets under pressure.
