Market Outlook Next Week | Image:
Freepik
The stock market bourses BSE Sensex and Nifty for the past six consecutive weeks has been in the negative terrain.
The broader market indices faced the brunt of tariff induced pressure with BSE Midcap index falling 1.3 per cent and the Smallcap index declining close to 2 per cent.
US President Donald Trump has imposed a total levy of 50 per cent on Indian import, however, what’s more poigant to note is Trump’s unaltered aggresive tune when it comes to India.
In the upcoming week, Indian stock market indices will be closed on Friday, August 15, to observe Independence Day.
Key Factors To Influence Stock Market In Upcoming Week
The next move on tariffs: After Trump raised the tariff imposition on Indian imports to 50 per cent, he further noted that trade talks with India would remain on hold until the tariff dispute was resolved.
The US President’s unpredictability poses a major concern for Indian stock market indices, as certain experts predict the impact of tariffs to reduce the south Asian country’s GDP growth by 1 per cent.
Meanwhile, negotiations between both countries later this month could see the cumulative tariff dropping to a reasonable bracket.
Currently, the US tariff on Indian imports of 50 per cent is the same as Brazil, while the tariff on Vietnam and Bangladesh is 20 per cent, and 30 per cent on China.
In the meantime, a tade pact between world’s top two economies China, and the US could see a large outflow of foreign capital from India.
According to several media reports, US and China are steering close to securing a trade deal before the August 12 deadline.
There could be a temporary deal between Washington and Beijing for now, and a final deal might be announced when Trump’s scheduled meeting with Chinese President Xi Jinping occurs before year end.
India-US inflation data: In the upcoming week, India and teh US CPI (Consumer Price Index)-based inflation prints will be in the focus of Indian stock market.
The July CPI inflation data is scheduled to be released on August 12, meanwhile, India’s wholesale price index (WPI) data will be out on two days later on August 14.
India’s July inflation is expected to further decelerate to 1.8 per cent from 2.10 per cent in the previous month. US CPI, on a year-on-year basis, may come to 2.8 per cent in July compared to 2.7 per cent in June.
India’s inflation is expected to remain benign in FY26. After the August MPC meeting, the Reserve Bank of India trimmed its FY26 CPI inflation forecast to 3.1 per cent from 3.7 per cent earlier.
On the other hand, concerns are rising that Trump’s tariff policies will stoke inflation in the US and drag the economic growth, potentially creating a stagflationary situation in the world’s largest economy.
A spike in US inflation will further dim the prospects of US Federal Reserve rate cuts, which will be negative for emerging markets like India.
Trump-Putin meet: The US President and his Russian counterpart, Vladimir Putin, will meet in Alaska on Friday, August 15. This event will be in focus across the globe as it may potentially pave the way for the end of the Russia-Ukraine war, which has been going on since February 24, 2022, when Russia invaded Ukraine.
US President Donald Trump and his Russian counterpart, Vladimir Putin are slated to meet on August 15, 2025 in Alaska. The event will be focus across the globe as it may potenially pave the way for the end of Russia-Ukraine war.
FPIs flows: Foreign portfolio investors (FPIs) have been on a selling spree of Indian stocks since July.
In the cash vertical, FPIS sold Indian stocks worth Rs 47,666.68 crore in July, while so far in August, they have offloaded stocks worth Rs 14,018.87 crore.
However, they bought Indian equities worth Rs 1,932.81 crore in the cash segment on Friday.
It is too early to say whether the trend of FPI buying will sustain, as tariff uncertainty and unimpressive earnings keep the short-term outlook of the market hazy.
Meanwhile, the movement of the US dollar and treasury yields will also affect the foreign capital flow.
Q1 earnings next week: Market participants will primarily focus on key earnings this week. According to the BSE, over 2,000 companies will announce their June quarter results in the coming week. Among the major ones that will release their earnings are Hindalco Industries, BPCL, and Hindustan Copper. Bajaj Consumer Care, Ashok Leyland, ONGC, and IOC.