PMI data, US-India trade progress likely to steer markets this week

Domestic PMI data, US Federal Reserve meeting minutes and the progress on India-US trade deal negotiations are likely to influence movement in the equity market in the week ahead, according to analysts.

Market direction in the next week will hinge on macro triggers such as domestic PMI data, Federal Reserve meeting minutes and the progress on India-US trade deal negotiations, analysts said.

Moreover, the trading activity of foreign investors would also influence the equity market trends.

"Looking ahead, market direction will hinge on key macro triggers such as India's PMI data, US jobless claims, FOMC minutes and progress on US-India trade negotiations.

"A prudent approach would be to focus on sectors with strong fundamentals, clear earnings visibility, and structural tailwinds -- positioning portfolios for potential upgrades in H2FY26," Vinod Nair, Head of Research, Geojit Investments Ltd, said.

Last week, the BSE Sensex surged 1,346.5 points, or 1.62 per cent, while the NSE Nifty advanced 417.75 points, or 1.64 per cent.

He noted that "Indian equity markets ended the week on a strong note, with benchmark indices gaining on the resolution of the US government shutdown, supported by strong domestic fundamentals, stronger-than-expected Q2 earnings, and easing inflation".

Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services, said, "Capital-market-linked stocks also remained active, supported by strong retail participation, elevated SIP flows, and enthusiasm for recent and upcoming IPOs."  He further stated that "Indian equities are likely to maintain their steady up-move this week, supported by firm domestic macros, healthy earnings and a strong electoral mandate for the ruling NDA in Bihar, which reinforces political stability at the Centre".

Khemka explained that with the earnings season concluding, market attention will shift toward broader domestic themes -- including early signs of a demand pickup from the festive and wedding season, the evolving interest rate trajectory, and prospects of higher capital expenditure through the second half of the fiscal year.

"The reopening of the US government and improving global risk appetite add to the supportive backdrop. Sectorally, information technology, metals, and capital market-linked names may remain in focus, aided by improving earnings visibility, favourable policy signals, and steady domestic liquidity," he added.

Ajit Mishra, SVP, Research, Religare Broking Ltd, said markets staged a strong rebound during the week, ending firmly in the green after the recent phase of weakness.

"Investor confidence improved significantly after India's retail inflation cooled sharply to 0.25 per cent in October from 1.44 per cent in September, aided by GST rate cuts and easing food prices," he said.

Mishra added that with the earnings season now behind, focus will shift to high-frequency domestic indicators such as Services PMI, foreign exchange reserves, and infrastructure output data.

"Globally, market mood will be shaped by key US economic releases, including the minutes of the latest Federal Open Market Committee (FOMC) meeting minutes. Additionally, the ongoing volatility in AI-linked stocks will remain a key factor to watch, given its potential to influence broader market sentiment," he said.