Which way will Nifty swing this week? These top 8 factors may help you predict

Global markets ended the week on a flat to negative note with US indices ending flat and European indices ending in the red. Escalation in the conflict between Iran and Israel led to profit booking from the markets with Israel attacking Iran causing uncertainty and fear in the market.

Here are the key factors that are likely to define the trajectory of Sensex, Nifty this week:

1) Q4 earnings

On the domestic front, the single biggest factor driving stock-specific movements would be the Q4 earnings season which picks up pace this week onwards. Biggies that would declare March quarter numbers during the week are RIL, Tata Consumer, Axis Bank, Bajaj Finance, ICICI Bank, Nestle, Axis Bank, and YES Bank.

When the market opens on Monday, it will also react to HDFC Bank’s Q4 numbers announced on Saturday.

2) Nifty Expiry

April F&O contracts of Nifty will expire on April 25. During the week, the index managed to hold 100-DMA and make a smart recovery from the lower levels at 21777. "22300 will be the first hurdle, while 22525 will be the next hurdle. If Nifty slips below 22000, then 100-DMA around 21700 will be the next support level," said Pravesh Gour, Senior Technical Analyst at Swastika Investmart.

On the derivatives front, the long exposure of FIIs in index futures stands at 35%, whereas the put-call ratio is sitting at the 1.03 mark, suggesting a bullish bias.

3) IPO/FPO calendar

After a short breather, the primary market will see the mainboard IPO of JNK India, which opens for subscription on April 23. Apart from this, the SME segment will also see three public offers.

Monday would be the last day of the follow-on public offering or FPO of Vodafone Idea's Rs 18,000 crore issue. Half of the issue has been subscribed already.

4) FII flows

As global macro worries continue to haunt foreign investors, FPIs have turned net sellers. “Now, the total FPI flow for April stands dwindled to Rs 5639 crore. It was the FPI investment through the primary market of Rs 22,092 crore which enabled the total equity flows to touch Rs 5,639 crore. FPIs sold equity worth Rs 16,452 crore through exchanges. This kind of big selling happens whenever the US bond yields spike beyond expectations,” VK Vijayakumar of Geojit Financial said.

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5) Crude oil

Brent crude oil prices posted a weekly decline, after Iran played down a reported Israeli attack on its soil, a sign that an escalation of hostilities in the Middle East might be avoided.

6) Bond yields

Movements in US bond yields and the dollar index will be important factors influencing market sentiment. Indian benchmark 10-year bond yields ended the week five basis points (bps) higher compared to a rise of 6 bps last week. This was the third straight rise in yields as investors remain worried about escalating tensions in the Middle East and the timing of Fed rate cuts.

7) Expectations from Fed

Fed officials, including New York Fed President John Williams, have said that there is no urgency for a rate cut given the strong state of the economy. Fed's rate-setting panel is scheduled to announce its decision on May 1.

8) Geopolitical tensions

If tensions escalate significantly, there's a risk of panic selling and increased volatility across global stock markets.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)