Next Week’s Stock Market Prediction: 7 Essential Factors Driving Market Movement
Stock Market Prediction Next Week (18- 22 March 2024): Indian stock markets snapped a four-week winning streak and closed lower for the week ending 15 March. The broader markets bleed after SEBI pushed for stress tests for small and mid-cap mutual fund schemes to address concerns about over-valuations. The weakness in global markets after hotter-than-expected inflation readings from the US also dented the market sentiments during the week.
In the upcoming week, global market sentiments will play a crucial role in setting the market directions. The global central banks including the US Fed, BoJ, and BoE will announce their interest rate decisions next week. China will also announce its Loan Prime Rate for 1 year and 5 years in the coming week.
The inflation rate from the Eurozone, the UK, and Japan and flash PMI data for March will also remain in focus. The overall global market trends, crude oil prices, FIIs, and DII activity will also dictate the trend on the bourses next week. The other key factors, that are likely to influence the domestic stock markets including stock market prediction are given below.
Stock Market Prediction for Next Week ( 18 – 22 March 2024)
Stock Market Prediction: Nifty & Bank Nifty
In the last week, the Nifty index witnessed selling pressure and slipped from the 22500 zone to hold support near the 21900 levels with the bias turning, slightly cautious. This range-bound trend of the Nifty index shall remain intact as long as the significant 50EMA zone of 21850 levels is sustained.
Meanwhile, a decisive move past the 22300 zone shall improve the bias to some extent. On a weekly basis, the Nifty index could rate in a range of 21500 to 22500 level.
Similarly, Bank Nifty witnessed selling pressure during the week moving just below the important 50EMA level of 46600, slightly weakening the bias. The banking index has the next major support of the 100 period MA of 46000 level.
A decisive breach above the 47300 zone is needed to improve the bias overall and expect for further uptrend. In the week, the Bank Nifty would have a range of 45300-48000 levels.
You can also follow our daily Nifty and Bank Nifty futures, trends, trading strategies, and market updates on our Website or Telegram Channel – https://t.me/nifty50stocks1
Domestic Economic Data
India’s trade deficit was released on Friday post-market hours showed widened to $18.71 billion in February, above the economists expectation of $18.30 billion. The country’s trade deficit in January was $17.5 bn, while it was recorded $16.6bn for the same period last year. Meanwhile, a separate report showed that India’s foreign exchange reserves jumped by $10.47 bn to $636.1 at a two-year high.
There is not much economic data to report in the upcoming week. The HSBC India flash manufacturing, services, and composite PMI reading for March will be announced on Thursday, March 21st. The Bank loan and deposit growth for March and weekly foreign exchange reserve will be released on Friday.
Global Stock Market Prediction Next Week
The global stock market indexes ended mixed for the week ending on March 15. The US, Japan, Kospi, and Australia’s ASX 200 stock market indexes closed lower, while Europe, China, and Hong Kong indices gained during the week. The hotter-than-expected US inflation data and the potential ending of negative interest rates in Japan dented the global market sentiments.
While some strong corporate earnings and positive economic data from Europe and China supported the market sentiments. You can also read Global Stock Market Performance & Analysis: Weekly Overview (11 – 15 March 2024)
In the upcoming week, several global central bank’s interest rate decisions will influence the world’s market and set the market direction. Traders will closely monitor the industrial production data and unemployment rate from China, the inflation rate from Europe and Japan, as well as the Flash PMI data for March from several countries in the upcoming week.
Central Bank’s Interest Rate Decision
The US Fed will announce its interest rate decision on Wednesday, March 20th, and is expected to keep rates steady for the fifth straight meeting. However, traders will be closely watching the policymaker’s updates on economic growth and inflation, and any clues on the interest rate cuts in June.
The Bank of Japan interest rate decision is scheduled for Tuesday, March 19th. The huge wage hikes by major Japanese firms, the largest in three decades, have significantly heightened the likelihood of ending negative interest rates at the monetary policy meeting scheduled for next week. It would be the first rate hike by the central bank in 17 years. The Reserve Bank of Australia (RBA) will also announce its interest rate decision on Tuesday
On Thursday, the Bank of England will announce its interest rate decision and likely to keep the rates steady in the upcoming meeting. Traders will be closely monitoring for more clues of the June rate cut.
Any cues of the June rate cut from the US Fed and BoE will be positive for the global markets. Meanwhile, ending the negative interest rate in Japan can dampen the global market sentiments.
Global Macroeconomic Data
| Important Global Macro Data Next Week | ||
| 18 March 2024 | Machinery Order Jan | Japan |
| 18 March 2024 | Industrial Production Jan-Feb | China |
| 18 March 2024 | Retail Sales Jan-Feb | China |
| 18 March 2024 | Unemployment Rate Feb | China |
| 18 March 2024 | Balance of Trade Jan | EA |
| 18 March 2024 | Inflation Rate Feb | EA |
| 19 March 2024 | BoJ Interest Rate Decision | Japan |
| 19 March 2024 | RBA Interest Rate Decision | AU |
| 19 March 2024 | Industrial Production Jan | Japan |
| 19 March 2024 | ZEW Economic Sentiments March | EA |
| 19 March 2024 | Housing Starts Feb | US |
| 20 March 2024 | Loan Prime Rate 1yr & 5yrs | China |
| 20 March 2024 | Inflation Rate Feb | GB |
| 20 March 2024 | Retail Price Index Feb | GB |
| 20 March 2024 | Consumer Confidence March | EA |
| 20 March 2024 | Fed’s Interest Rate Decision | US |
| 21 March 2024 | Balance of Trade Feb | Japan |
| 21 March 2024 | Jibun Bank PMI Flash | Japan |
| 21 March 2024 | HCOB PMI Flash | EA |
| 21 March 2024 | S&P Global PMI Flash | GB |
| 21 March 2024 | BoE Interest Rate Decision | GB |
| 21 March 2024 | Initial Jobless Claims | US |
| 21 March 2024 | S&P Global PMI Flash | US |
| 21 March 2024 | Existing Home Sale | US |
| 22 March 2024 | Inflation Rate Feb | Japan |
| 22 March 2024 | Gfk Consumer Confidence March | GB |
| 22 March 2024 | Retail Sales Feb | GB |
Crude Oil Prices
The crude oil prices ended slightly lower on Friday, falling from a four-month high on account of profit booking ahead of the Federal Reserve meeting next week. Investors booked profits on Friday in response to hotter-than-anticipated US inflation data, prompting the Federal Reserve to adopt a more hawkish stance.
In the week, the WTI crude oil closed higher by 4.20% while the Brent crude rallied 3.97%. Earlier in the week, the sentiments were positive due to improving demand for crude oil in the US and tightening supply. Meanwhile, the OPEC and IEA have also forecasted strong demand for crude oil in 2024 and 2025, in their monthly reports published during the week.
Traders should remain cautious and track crude oil prices in the upcoming week, as a substantial rise in crude oil prices could dampen the equity markets.
FII & DIIs flow
Foreign Institutional Investors (FIIs/FPIs) were turned net sellers in the last week, they sold shares worth Rs 816.91. crore in the Indian equity cash segment. The Domestic Institutional Investors (DIIs) were the net buyers and acquired shares worth Rs 14147.5 crore during the week. FIIs were the net buyers in three out of five trading sessions during the week, while DIIs bought shares in four sessions.
Although FIIs were the net sellers last week, they bought shares worth more than 9000 crore in equity cash segments in March. Traders should keep a close eye on the FIIs and DIIs activity in the upcoming week, as the FII’s buying spree could support the domestic markets to reach a new high again.
Conclusion:
To summarise the stock market prediction for next week, Indian markets ended last week on a subdued note. Presently, the sentiments from the global markets are not favorable and are expected to remain volatile in the upcoming week ahead of the global central bank’s monetary policy meeting and key economic data releases.
Going ahead, we advise traders to exercise caution ahead of the US Federal Reserve monetary policy and trade with strict stop losses. Traders can follow our Daily Morning Report at 7.30 a.m. IST for insights into the Stock Market Outlook and market direction.
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