The Sensex and the Nifty finished the week in the red, each falling by more than one per cent. Heavy selling in IT shares hurt investor confidence as worries grew about how artificial intelligence could affect the sector. Stronger US jobs data also reduced hopes of an early interest rate cut by the Federal Reserve.
Here are seven things that may influence the market in the coming days
Infosys and Wipro ADRs recover
After two days of sharp losses in which the ADRs of Infosys and Wipro dropped up to 14.5 per cent, both stocks saw buying interest on Friday. Infosys rose about 3 per cent and Wipro gained around 4 per cent. JP Morgan said IT service companies remain essential to the technology ecosystem. It noted that dividend yields are at levels seen during earlier crises and believes the recent fall has created value opportunities in large names such as Infosys and TCS.
US inflation data raises rate cut hopes
Fresh data showed US consumer inflation at 2.4 per cent year on year, slightly lower than expectations. This increased market hopes that the Federal Reserve may cut rates at least twice this year. The White House welcomed the softer number, though concerns about jobs and the cost of living continue to influence public mood.
FII strategy amid AI worries
VK Vijayakumar of Geojit Investments said foreign investors have been net sellers this month, with a big part of the outflow coming on February 13 when IT stocks fell sharply. However, he believes sentiment has improved after the recent Budget and the India“US trade deal. With earnings expected to improve, he feels FIIs could return as buyers once volatility in IT reduces.
Rupee versus dollar
The rupee ended at 90.64 against the dollar, almost unchanged. A stronger US currency can push money away from emerging markets such as India. Analysts say the dollar“rupee pair is in a consolidation phase, with the 90 level acting as an important base.
Weak technical signals
The Nifty has slipped below its recent range and closed under 25,500, mainly because of IT weakness. Key support is seen around 25,400“25,300, with a deeper cushion near 25,200“25,000. On the upside, resistance is placed near 25,550“25,600. Traders say the market needs to move above higher levels to show signs of stability.
US data next week
Investors will watch the minutes of the latest Federal Reserve meeting and US GDP figures for the October to December quarter. These may give better clarity on the path of interest rates. Such global signals are important for Indian markets, especially when foreign flows remain uncertain.
Geopolitical risks
Reports suggest the US military is preparing for the possibility of longer operations against Iran if President Donald Trump approves action. At the same time, diplomatic efforts are continuing. Any rise in tensions could affect global risk appetite and financial markets.
