Will Nifty hit fresh record high before elections? That depends on these 5 factors

The week may remain lacklustre on the data front as no major economic data releases are scheduled in both the US as well as the Indian market. Indian investors are likely to focus more on the ongoing earnings season as well as stock specific developments. Nifty and Sensex have reached all-time highs driven by US Fed data and expert insights. Key factors that will shape market outlook.

ended the extended 6-day trading week around 2% higher as moderation in India's CPI and lower-than-expected inflation figures from the US Fed boosted .

Global cues remained largely supportive as major indices of the US market such as Nasdaq, S&P 500 and Dow touched lifetime highs. This week will be a curtailed one with Monday being a market holiday on account of voting in Mumbai for Lok Sabha .

"The week is going to remain lackluster on the data front as no major economic data releases are scheduled in both the US as well as Indian market. Hence, the focus of Indian investors will largely remain on the ongoing earnings season as well as stock specific developments. We expect election led to continue in the Indian market and hence, advise investors to exercise caution and accumulate good quality stocks during this volatile phase," said.

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This week's rally has taken both Nifty and Sensex towards levels. Here are the key factors that will decide whether the market will hit a new high:

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1) Last leg of
This week Q4 earnings of major companies like ONGC, ITC, Sun Pharma, Nykaa, Honasa, Hindalco, Ashok Leyland and Divi's Lab will be announced.

2) Speculations around election outcome
Volatility is likely to be high largely due to election related rumours and speculations in the betting markets. The week will have two voting days on May 20 and then again on May 25 before the last phase of polling on June 1.

3)
Market participants will be keeping a close eye on uncertainties regarding the timing of US Fed rate adjustments. Fed chair's Jerome Powell's speech on Monday will be keenly watched.

The release of PMI data for May from both the US and India this week will also be closely monitored for further market insights.

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4)
During the week, FIIs sold Rs 12,903 crore while DIIs net bought Rs 14,563 crore in the cash market.

"This shift in FPIs' behavior is not a random occurrence. It is a direct response to the ongoing geopolitical crisis in the Middle East, relative valuation discomfort, and the strength of US bond yields. These factors have prompted FPIs to swiftly withdraw funds from their portfolios, a move that significantly impacts the Indian equities market," said Vipul Bhowar, Director, Listed Investments, .

5)
On Saturday, heavy writing was visible in both Call and Put at the 22,500 strike, indicating a sense of inflection.

"Traders need to be watchful in the initial hour to confirm any directional move. Support is visible at 22,400. On the higher end, a sustained move can take the index towards 22,600 and higher in the short term, said Rupak De of .