Stock market next week: The Indian stock market snapped a six-day winning streak on Friday as most Dalal Street indices witnessed panic selling ahead of Jerome Powell’s speech at the Jackson Hole Symposium. The Nifty 50 index lost 213 points and closed at 24,870, the BSE Sensex shed 693 points and closed at 81,306, while the Bank Nifty index corrected 606 points and finished at 55,149. However, Auto heavyweights M&M, Maruti, and BEL led the charge among the Nifty’s top performers. In contrast, on the flip side, it proved to be a tough session for names like Grasim, Asian Paints, and Adani Enterprises, which ended as the major losers within the Nifty pack.
According to experts, the Indian stock market may witness a trend reversal on Monday when it resumes trading activity for a truncated week. They said global sentiments have improved after the US Fed chief Jerome Powell’s speech at the Jackson Hole Symposium. The annual gala of the American Central Bank has triggered hopes for a US Fed rate cut in 2025, putting the US dollar rates and the US bond market under pressure. However, they remained shy about announcing the fresh bull trend as they believe 25,250 to 25,300 is a big hurdle for the Nifty 50 index.
Continuous FIIs’ selling is also expected to pause after the US Fed rate cut hope, triggering a fresh push for Dalal Street bulls. They said that Jackson Hole Symposium, US Fed rate cut buzz, RBI rate cut trigger, dip in US dollar and bond yield, etc., are some primary triggers that may dictate the Indian stock market next week.
Top 5 triggers for the Indian stock market
1] US Fed rate cut buzz: “The Indian stock market is poised to open on a positive note, taking cues from Fed Chair Jerome Powell’s highly anticipated Jackson Hole address, where he delivered a clear dovish signal that a rate cut is imminent. By acknowledging the rising risks of a weakening US job market, Powell effectively conceded the possibility of shifting the Fed’s monetary policy stance to support employment and growth,” said Sugandha Sachdeva, Founder of SS WealthStreet.
2] Global cues: “After the Jackson Hole Symposium, the Indian stock market is expected to follow the global cues, especially the US stock market. The global market is expecting a 25 bps US Fed rate cut, fueling the liquidity buzz on Dalal Street. However, this buzz may not enable Nifty 50 crossing the hurdle placed at 25,250 to 25,300,” said Anuj Gupta, Director at Ya Wealth.
3] FIIs’ trade pattern: Expecting a pause in FIIs’ selling, Anuj Gupta of Ya Wealth said, “FIIs have been continuously selling in the Indian stock market. However, after the US Fed rate cut buzz, there is expectation of trend reversal in FPIs’ trade pattern as rate cut buzz has put US bond yield and US dollar rates under pressure,” said Anuj Gupta of Ya Wealth.
FIIs showed a mixed trend last week, turning buyers in select sessions but remaining largely cautious overall, with a net outflow of approximately ₹1,559.51 crore. DIIs remained consistent net buyers, providing steady support to the market with a net inflow of around ₹10,388.23 crore.
4] RBI rate cut buzz: Highlighting the RBI rate cut buzz, Sugandha Sachdeva said, “A Fed rate cut could also provide the Reserve Bank of India (RBI) with added flexibility to consider a final 25-bps rate reduction in its upcoming policy review, potentially marking the culmination of the current easing cycle.”
5] Russia-Ukraine war: “Despite the Trump-Putin and Trump-Zelensky meetings, uncertainty over the Russia-Ukraine war persists. The geopolitical tension is still around and can change the market dynamics at any time,” said Anuj Gupta of Ya Wealth.
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