Stock market forecast: Will Sensex and Nifty continue to rise? Factors to watch next week.

Indian equity markets closed the week on a high note, with the Sensex and Nifty posting respectable gains following a bout of volatility earlier in the week. The positive momentum was fueled by increased investor confidence stemming from trade deals, consistent RBI policies, and improved foreign institutional investor (FII) flows.

On Friday, the BSE Sensex surged by 266 points, or 0.32 percent, to settle at 83,580.40, while the Nifty 50 index added 51 points, or 0.20 percent, to end the week at 25,693.70. The rally was supported by robust performances from prominent stocks like ITC, Kotak Mahindra Bank, and ICICI Bank.

Despite initial concerns sparked by Budget-related developments, market sentiment was buoyed by various positive domestic and global factors. Ajit Mishra, SVP of Research at Religare Broking Ltd, highlighted the week’s resilience, noting that despite volatility, markets closed with significant gains. The announcement of an India–US trade deal and the RBI’s decision to maintain policy rates unchanged and revise GDP growth estimates upward helped bolster investor confidence.

Looking ahead, experts anticipate a consolidation phase in the markets, with a keen eye on policy implementation and real economic activities. Geopolitical dynamics, such as ongoing US-Iran negotiations, could also influence market volatility. Additionally, upcoming Q3 results from companies like BSE, HUL, Titan Company, and others are expected to impact market movements.

Key factors likely to impact market movements in the coming week include developments on the India–US trade front, upcoming inflation data, corporate earnings announcements, and fluctuations in commodities prices. The interim trade pact between India and the US, aimed at reducing tariffs, is expected to provide clarity and support export-oriented sectors. Meanwhile, inflation data releases and corporate earnings reports are expected to drive market sentiment.

Gold and silver prices have rebounded, supported by bargain buying and geopolitical concerns. FII flows have turned positive, with net equity purchases recorded on February 6. From a technical standpoint, market analysts anticipate a positive bias for the Nifty above 25,400, with strength observed in Bank Nifty and Sensex amidst a consolidation phase.

Overall, the stock market outlook remains cautiously optimistic, with a focus on key triggers such as economic data releases, corporate earnings, geopolitical events, and global market developments. Investor sentiment is expected to remain event-driven, with ongoing monitoring of various factors shaping market movements in the coming week.