Global economic data, easing India-Pakistan tensions to drive market mood next week

Mumbai: For the Indian stock market, the upcoming week, from May 19 to 23, is expected to be driven by key global economic data releases and the continued positive impact of easing geopolitical tensions between India and Pakistan.

Investors will be closely tracking macroeconomic indicators from India, the US, and China, which could influence market sentiment and central bank policy outlooks, according to Bajaj Broking Research.

In India, the HSBC India Manufacturing PMI data, set to be released on May 22, will be in focus. This index will offer a snapshot of the health of the manufacturing sector and overall business confidence.

China will publish crucial economic figures on May 19, including Industrial Production and Retail Sales data.

These numbers are key to understanding the strength of the Chinese economy and its domestic consumption trends, both of which carry significant implications for global trade.

In the US, the week will start with MBA Mortgage Applications data on May 21, which will offer a view into the health of the housing sector.

This will be followed by Initial Jobless Claims and the S&P Global US Manufacturing PMI on May 22.

Both reports are key to understanding the state of the US job market and industrial activity.

The week will close with New Home Sales data on May 23, providing a final picture of the US housing market’s strength.

These updates are likely to give important signals about the direction of the economy and could influence stock market movements, Bajaj Broking Research said.

Meanwhile, the Indian stock markets witnessed a strong rally this week, fuelled by the resolution of India-Pakistan tensions in India’s favour and without much escalation.

This geopolitical relief, along with easing tariff concerns, lifted investor confidence sharply.

As a result, the Nifty index recorded its biggest single-day gain in recent times and ended the week with a strong rise of 1,011.80 points, or 4.21 per cent.

This sharp rally was supported by lower market volatility. The India VIX, which reflects market fear, dropped by 23.49 per cent to 16.55.

Throughout the week, the Nifty moved in a wide 737-point range but managed to hold on to its gains and even build further momentum.

–IANS