Week Ahead: RBI Policy, Trump Tariffs, Q4 Results Among Key Triggers for Indian Stock Market
The Indian stock market started the new fiscal year FY26 on a weak note, with benchmark indices ending sharply lower last week and snapping a two-week winning streak. Global trade tensions triggered by US President Donald Trump's unexpected tariff hikes have spooked investors across domestic and global markets alike.
As we enter the second week of April, several critical market triggers will determine the direction of Indian equities. Let's examine the key factors that investors should monitor closely.
Last Week's Market Performance
The domestic equity benchmarks fell significantly, dragged primarily by weak global cues and renewed concerns over a potential trade war. During the week, the BSE Sensex tanked 2,050.23 points (2.64%) while the NSE Nifty declined 614.8 points (2.61%). The Nifty 50 ended the week at 22,904.40, while the Sensex settled at 75,364.69, near the week's low.
On Friday alone, the 30-share BSE index slumped over 900 points, crashing below the 76,000 level due to an across-the-board sell-off. A steep decline in the US stock markets further dampened hopes of recovery in domestic equities.
Key Market Triggers for the Coming Week
RBI Monetary Policy Committee Meeting
The Reserve Bank of India's rate-setting panel will begin deliberations this week on its first policy verdict for FY26. The outcome of the MPC meeting and interest rate decision on April 9 will be a major market trigger.
Market experts anticipate that this policy meeting will provide crucial insights into the central bank's stance and India's economic outlook. Many analysts foresee another 25 basis points interest rate cut, which could potentially benefit rate-sensitive sectors if the outcome is favorable.
Q4 Earnings Season Kickoff
The March quarter earnings season begins this week, with IT giant Tata Consultancy Services (TCS) scheduled to announce its results on Thursday, April 10. The software services leader may also declare a final dividend for FY25 on the same day.
According to market analysts, the initial outlook remains subdued, with risks of further downward revisions to earnings growth, largely due to tepid demand and continued margin pressures. The IT sector specifically is expected to report soft numbers, and investor sentiment will depend heavily on management commentary about future prospects.
Persistent global growth concerns and potential elevated inflation in the US may lead companies to delay discretionary IT spending, potentially dampening the sector's near-term outlook.
Trump Tariffs and Global Trade Tensions
The market sell-off was initially triggered by the US President's decision to impose steep reciprocal tariffs on key trading partners, including a 27% levy on select Indian goods. This move has reignited fears of a global trade war, prompting broad-based risk aversion across emerging markets.
Market sentiment further weakened amid rising US Treasury yields and lingering inflationary concerns, which dampened hopes of an early rate cut by the US Federal Reserve. Volatility has remained elevated, with the India VIX index rising significantly, reflecting heightened caution ahead of quarterly earnings and ongoing election-related developments.
Investors will closely monitor any countermeasures implemented by global trade partners, which could further exacerbate geopolitical and economic uncertainty. The cautious sentiment is reflected in the sustained rally in gold and bond prices, underscoring a pronounced shift toward safe-haven assets.
Macroeconomic Data Releases
Key macroeconomic indicators - the Index of Industrial Production (IIP) and Consumer Price Index (CPI)-based inflation for March 2025 - are scheduled for release on Friday, April 11. However, as per the Statistics Ministry's timeline, the CPI inflation data might be released on April 15, since April 14 is marked as a holiday to observe Ambedkar Jayanti.
These data points will provide crucial insights into India's economic performance and could significantly influence market sentiment.
Foreign Institutional Investor Activity
Foreign institutional investors (FIIs) turned aggressive sellers last week, pulling out approximately ₹13,730 crore from the cash segment, while domestic institutional investors (DIIs) provided some support with net inflows of around ₹5,632 crore.
The trend of FPIs turning buyers in March changed in early April when they turned sellers again following President Trump's announcement of reciprocal tariffs. The steeper-than-expected tariffs have raised concerns that the US economy might slip into stagflation, triggering massive selling in US markets where the S&P 500 and Nasdaq lost above 10% in just two days.
The total FPI selling in India up to April 5 stood at ₹10,354 crore. However, the steep decline in the dollar index to 102 is considered favorable for capital flows to emerging economies like India, although FPIs are likely to remain in a wait-and-watch mode before turning buyers again.
Global Economic Indicators
Several important global economic indicators will be released this week:
- The minutes of the US Federal Open Market Committee (FOMC) meeting will be released on Wednesday, April 9
- China's March CPI inflation data is scheduled for release on Thursday, April 10
- The US inflation and core CPI data will be released on Thursday, April 10
- The February UK GDP data is scheduled for release on Friday, April 11
Technical Outlook
From a technical perspective, Nifty 50's immediate support lies at 22,600, while a decisive breach could open the door towards 22,100. On the upside, any recovery is likely to face stiff resistance in the 23,100–23,400 zone.
Primary Market Update
The primary market will not witness any action this week, with no new initial public offerings (IPO) or listings slated across the mainboard and small and medium enterprises (SME) segments.
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