West Asia Conflict, Oil Prices, and Inflation Data to Drive Stock Market Next Week

Developments in the West Asia conflict, crude oil prices, and US inflation data are expected to drive stock market movements next week. Analysts predict that geopolitical tensions between the US and Iran will continue to influence global energy markets, pushing up oil prices. The Brent crude price rose by over 8% during the week, while WTI crude increased by more than 9%. These elevated oil prices, combined with concerns surrounding the Strait of Hormuz, are expected to remain a persistent overhang on market sentiment.

The upcoming US inflation data will be critical in shaping Federal Reserve policy and global market sentiment. The direction of Treasury yields and interest-rate expectations will remain closely intertwined with the inflation narrative. Indian equity markets have experienced volatility and a losing streak due to global uncertainties, with the Nifty-50 extending its losing streak to four consecutive weeks.

Ajit Mishra, SVP, Research at Religare Broking Ltd, noted that developments around the Strait of Hormuz will remain a critical monitorable given their implications for India's inflation, external balance, and corporate profitability. Hariselvan Radhakrishnan, founder and CEO of HST Wealth, said that attention now shifts to the upcoming US inflation data, which could prove critical in shaping expectations for Federal Reserve policy and global market sentiment.