Week Ahead: Q4 results, Trump tariffs, F&O expiry, global cues among key triggers for Indian stock market

The Indian stock market last rallied sharply to log its best week in four years, driven by a reversal in foreign investors' selloff and expectations of a breakthrough in US-Japan trade negotiations over reciprocal tariffs.

Next, investors will monitor key market triggers in the fourth week of the new fiscal (FY26). The next set of March quarter earnings for fiscal 2024-25 (Q3FY25), global tariff announcements, the scheduled derivatives expiry, and global cues will dictate the market direction in the fourth week of April.

Domestic equity benchmarks, Sensex and Nifty 50, rose two per cent in the previous session, logging their fourth day of rally in the holiday-shortened week. The 30-share BSE benchmark Sensex jumped 1,508.91 points or 1.96 per cent to reclaim the 78,000 level. It finally settled at 78,553.20.

The NSE Nifty surged 414.45 points or 1.77 per cent to 23,851.65. In four days, the BSE benchmark jumped 4,706.05 points or 6.37 per cent, and the Nifty surged 1,452.5 points or 6.48 per cent. Still, the benchmarks are down around nine per cent from their lifetime highs in late September.

"This sharp rally in Indian equities over the past week has been driven by a combination of softened valuations from the earlier correction, a relief rally due to the US tariff pause, and positive cues from the RBI’s monetary policy," said Vishnu Kant Upadhyay, AVP - Research & Advisory, Master Capital Services.

While the frontline indices erased all their year-to-date losses, their major Asian peers underperformed due to the uncertainty over US tariffs and worries about their effect on economic growth. Following the central bank's rate cut, D-Street's financial stocks rallied, hoping for healthier net interest margins after top lenders lowered their deposit rates. The scheduled expiry of April series contracts will lead to increased volatility on the derivatives front ahead.

"India has emerged as the first major market to fully recover from the losses triggered by the US tariff announcements earlier this month. Investor sentiment was buoyed by expectations that the US-China trade dispute may not harm, but rather benefit, India," said Vinod Nair, Head of Research, Geojit Investments Ltd.

"The domestic macroeconomic environment remains supportive, encouraging investors to increase their exposure to riskier assets for the long term. The inflation outlook appears favourable, reinforced by forecasts of an above-normal monsoon and a decline in oil prices," added Nair.

This week, the primary market will not witness any action, with hardly any new initial public offerings (IPO) or listings slated across the mainboard and small and medium enterprises (SME) segments. The week will be critical from the domestic and technical points of view. Investors will track domestic and global macroeconomic data with corporate earnings.

Here are the key triggers for the Indian stock market in the coming week:

Q4 Results

In the upcoming week, all eyes will be on the market reaction to earnings reports from heavyweights such as Infosys, Yes Bank, HDFC Bank, and ICICI Bank. Companies like HCL Technologies, Axis Bank, Hindustan Unilever, and Maruti Suzuki India are scheduled to announce their quarterly results.

Many major companies are set to release their quarterly and full-year FY25 earnings in the coming week. According to Vinod Nair of Geojit Investments, the earnings growth for the fourth quarter of FY25 will likely be insipid due to muted demand and margin pressures.

"These results will be pivotal in shaping the market’s direction, as investors and market participants closely evaluate corporate performance and forward guidance. Disappointing earnings could dampen the current market sentiment and erode recent gains," said Vishnu Kant Upadhyay of Master Capital Services.
 

FII Activity

Over the last three trading sessions, foreign portfolio investors (FPIs) have purchased over $1 billion worth of Indian equities after a prolonged selling streak. FPIs continued selling in the first half of April. The total FII sell figure for the month up to April 19 stood at ₹23,999 crore.

However, FII activity reversed during the last three trading days ending April 17. During these days, FIIs bought stocks worth ₹14,670 crore in the cash market. Two important factors caused the reversal in FII activity.

A decline in the US dollar index to 100 and the expectation of more dollar weakness are nudging FII away from the US to emerging markets. Two, the US and China will report subdued growth this year, while India is expected to clock six per cent growth in FY26, even amid global uncertainty.

According to Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments, India's relative outperformance in growth can lead to market outperformance. The FII buying trend can be sustained even in this uncertain environment.

“Foreign allocations to Indian equities had dropped to their lowest level in years, leaving global funds structurally underweight on India and creating a significant allocation gap, potentially leading to further buying in the future,” said Vishnu Kant Upadhyay of Master Capital Services.
 

Global Cues

Uncertainty remains high about tariffs. Donald Trump wants to bring manufacturing jobs back to the US and trim how much it imports compared to how much it exports. Economists worry that the tariffs could cause a recession if implemented and left in place. Trump said negotiations with other countries could lead to lower tariffs, which Wall Street hoped for.

US Federal Reserve Chair Jerome Powell reiterated that Trump’s tariffs appear to be larger than the central bank was expecting, which could, in turn, slow the economy and raise inflation more than the central bank had earlier thought.

Powell said the US Fed would wait to see how conditions play out more before moving on interest rates. Trump criticised the Fed, saying it is “always TOO LATE AND WRONG.” He said, “Powell’s termination cannot come fast enough!”

An independent US Fed that can act without influence from the White House is one of the primary reasons the US has benefited from its reputation as a safe place to invest. History suggests central banks with more autonomy tend to have economies with lower and more stable inflation.

Globally, any tariff-related updates and their potential impact on world markets will remain in focus. The US dollar, bond yields, and crude oil prices will also remain in focus. Wall Street mega-caps and major companies will announce quarterly results and trigger stock-specific reactions. Global macroeconomic data releases will be eyed for market movement.

Corporate Action

Shares of Muthoot Finance Ltd, Schaeffler India Ltd, CIE Automotive India Ltd, others will trade ex-dividend in the coming week, starting Monday, April 21. Shares of some stocks will also trade ex-bonus. Check full list here

Technical View

From a technical perspective, the Nifty 50 benchmark index has a potential upside towards the 24,250–24,600 zone. In case of a dip, the 23,000–23,300 zone is likely to act as a support. Read full technical analysis here

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts, consider individual risk tolerance, and conduct thorough research before making investment decisions, as market conditions can change rapidly, and individual circumstances may vary.