Stock Market Prediction Next Week (19- 23 Feb 2024)
Stock Market Prediction Next Week (19 – 23 Feb 2024): The Indian stock markets rebounded and gained over 1 percent for the week ending February 16th. The domestic markets closed higher as India’s retail inflation eased to a three-month low and strong industrial production data. The solid corporate earnings from Coal India, M&M, JSW Steel, and Eicher Motors also aided the indices to close higher for the week. However, the upside remained capped due to persistent selling pressure from foreign investors and a surge in crude oil prices.
In the upcoming week, the domestic and global macroeconomic data will remain in the focus, as several countries including India will announce flash manufacturing, services, and composite PMI data for February during the week. Investors will be closely monitoring the FIIs and DII investment activity, Crude oil prices, and rupee movement against the dollar.
The minutes of the latest monetary policy meeting of the Reserve Bank of India (RBI) and US Federal Reserves will be released on 22nd February, and are likely to impact the markets. The other key factors that are likely to influence the domestic stock market prediction next week are given below.
Stock Market Prediction Next Week (19 to 23 Feb 2024)
Stock Market Prediction: Nifty & Bank Nifty Next Week
On Friday, the Nifty index continued its winning streak. Opening with a gap-up and breaching the 22,000 zone, Nifty maintains its strength and bias, with expectations of retesting previous peak levels in the upcoming sessions.
The Nifty index would have the 21800 level as the important support zone and can expect higher targets of 22400 and 22800 levels once a decisive breakout above the previous peak level is confirmed. In the week, Nifty could trade in a range of 21700 to 22400 level.
The Bank Nifty, after a gap-up opening on Friday surged ahead but witnessed resistance near the 46700 level. Due to the profit booking the banknifty index slipped down to end near 46400 levels.
The index would have the crucial hurdle of 46800 levels which need to be breached to expect further upmove, while on the downside the levels near the significant 50EMA zone of 46100 would act as the near-term support level. In the week, Bank Nifty index would trade in a range of 45300-47600 levels
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Domestic Economic Data
From January 2024 onwards HSBC started providing flash estimates of Indian manufacturing, services, and composite PMI data. The data release precedes the actual PMI data of each month by about one week. The flash data is based on 85-90% of the total PMI survey responses. In the coming week, the manufacturing, services, and composite PMI flash data for February will announced.
Other than the flash PMI data, investors will also react to the minutes of the RBI monetary policy’s last meeting. The other economic data including bank deposit and loan growth and Foreign exchange reserves are scheduled to be released on Friday.
Global Stock Market Prediction Next Week
Global Stock Market So Far
Globally the stock market indexes ended on a mixed note for the week ending on February 16. The US stock market indexes closed lower as inflation data surprised the markets and surged the Treasury yields during the week. The higher-than-expected CPI and PPI inflation dented the US market sentiments. However, the downside remained capped due to weak retail sales data and some strong corporate earnings released during the week.
European stock market indexes ended higher due to cooling inflation in the UK and hopes of early interest rate cuts. The sentiments were also positive as some corporates reported strong earnings in the fourth quarter. During the week, the major Asian stock markets closed higher. Japan’s Nikkei traded at a 34-year high due to strong quarterly earnings and weakness in the Yen against the dollar.
Despite Japan entering a technical recession, sentiments remained positive as the contraction in economic growth raised hopes that the Bank of Japan would continue its ultra-loose monetary policy. China’s stock market remained shut last week due to the Lunar New Year holiday, while Hong Kong, South Korean, and Australian stock market indexes ended in the green.
You can also read Global Stock Market Weekly Review: US Stocks Dip, European and Asian Markets Rise
Global Stock Market Prediction Next Week
In the upcoming week, the FOMC minutes of the last meeting and Nvidia’s quarterly earnings will remain in focus in the US markets. Investors will be closely watching the FOMC minutes as it will reveal how close they are to cutting interest rates. Market experts anticipate that Nvidia’s quarterly earnings report, scheduled for Wednesday after the markets close, could lead to profit-taking in the stock and potentially drag down other chip-related stocks.
The speech of US Fed officials, Flash PMI data, and quarterly earnings including Walmart, Home Depot, Moderna, and Warner Bros Discovery will be closely monitored by the trader next week. In Europe, other than flash PMI, the final print of inflation data and consumer confidence will be monitored.
In China, traders will be back on the trading floor after a week-long holiday. Traders will closely monitor China’s Loan Prime rate for 1 & 5 years on Monday and the House price index on Friday.
Global Macroeconomic Data
| Important Global Macro Data Next Week | ||
| 19 February 2024 | Machinery Orders Dec | Japan |
| 19 February 2024 | PBoC 1-year MLF Announcement | China |
| 20 February 2024 | RBA Meetings Minutes | AU |
| 20 February 2024 | Loan Prime Rate 1 & 5 Year | China |
| 20 February 2024 | Current Account Dec | EA |
| 21 February 2024 | Reuters Tankan Index Feb | Japan |
| 21 February 2024 | Balance of Trade Exp & Imp Jan | Japan |
| 21 February 2024 | Fed Bostic Speech | US |
| 21 February 2024 | Consumer Confidence Flash Feb | EA |
| 21 February 2024 | Fed Bowman Speech | US |
| 21 February 2024 | FOMC Minutes | US |
| 22 February 2024 | Jibun Bank PMI Flash Feb | Japan |
| 22 February 2024 | HCOB PMI Flash Feb | EA |
| 22 February 2024 | S&P Global PMI Flash | GB |
| 22 February 2024 | Inflation Rate Final Jan | EA |
| 22 February 2024 | S&P Global PMI Flash | US |
| 22 February 2024 | Weekly Jobless Claim | US |
| 22 February 2024 | Existing Home Sales Jan | US |
| 23 February 2024 | Gfk Consumer Confidence Feb | GB |
| 23 February 2024 | House Price Index Jan | China |
| 23 February 2024 | Consumer Inflation Expectation Jan | EA |
Crude Oil Prices
On Friday, crude oil prices closed higher, ending the week with a modest gain. The rising tensions in the Middle East continued to fuel concerns about potential supply disruptions and offset the worries about the slowdown in oil demand. In the week, the WTI Crude oil gained 3.06% while Brent crude was up 1.56%.
The concerns about global growth arose as earlier during the week, the IEA monthly report on Thursday said oil demand could slow down slightly, lowering last month’s estimates. The hotter-than-expected US inflation rate reduced the hope that early interest rate cuts could dampen the oil demand. Similarly, both the U.K. and Japan entered a technical recession in the December end quarter due to a contraction of the GDP growth rate on Thursday will also impact oil demand.
While there are rare chances of a spike in oil prices, weakness in crude oil prices can potentially benefit the domestic markets next week. Traders should closely monitor crude oil prices in the coming week.
FII & DIIs flow
Foreign Institutional Investors (FIIs/FPIs) were the net sellers in the last week, they offloaded shares worth Rs 6237.55 crore in the Indian equity cash segment. Meanwhile, Domestic Institutional Investors (DIIs) were the net buyers and acquired shares worth Rs 8731.6 crore more than what FIIs sold during the week. FIIs were the net buyers in three out of five trading sessions last week, while DIIs bought shares in all five trading sessions.
In December, FII inflows intensified significantly after the US Federal Reserve hinted to end its rate tightening cycle, thereby raising expectations for a rate cut in March 2024. This development prompted a decline in US bond yields, consequently sparking increased foreign fund inflows into emerging markets such as India.
However, FII/FPIs were massive sellers in January’s second half mainly due to the concern of high valuation in Indian equity markets and rising bond yields as the hopes of early US rate cuts faded away. Traders should keep a close eye on the activity of FIIs and DIIs in the coming week. If FIIs turned buyers in the Indian markets then we could see new highs in Nifty and Sensex.
Conclusion
To summarise the stock market prediction for next week, the Indian stock markets closed on a strong note last week, whereas global markets ended with a mixed performance. As we turn our attention to the upcoming week, the focus will be primarily on global cues. Anticipating a positive trajectory for the Indian markets in the first half of the week, and a possibility of profit booking emerging in the latter half of the week.
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