India's GDP Data, Maha Shivratri Holiday, Tokyo CPI: The Week Ahead

The upcoming week is expected to be subdued, with a shortened trading period as the stock market will be closed on Feb. 26 for Maha Shivratri. India's latest GDP data is set to be released this week, along with key economic data from South Korea, Japan, and Australia.

On the IPO front, the Indian market is expected to see muted activity. Investors will witness one mainboard listing, with Quality Power Electrical Equipments Ltd. debuting on Feb. 21. Meanwhile, three SME IPOs will open this week, while three others will close.

Technically, on both daily and weekly charts, the market is still holding a lower top formation and is trading below the 20-day Simple Moving Average, which is largely negative, according to Amol Athawale, VP-Technical Research, Kotak Securities.

"We believe that the larger market texture remains on the weak side; however, we could expect a quick technical pullback rally if it succeeds in holding above 22.950. If it does, it could bounce back to 23,100-23,200," he said.

On the other hand, if it falls below 22,720, the correction wave is likely to continue. Below that level, it could slip to 22,500-22,400. Near 22,400, contrarian traders may prefer to take a long bet with a strict stop loss of 22,320," said Athawale.

Incessant foreign capital outflows, global tariff concerns and lack of positive domestic triggers dragged India's benchmark stock indices for a second week in a row.

The Nifty and Sensex ended lower for the fourth consecutive session on Friday, as Mahindra & Mahindra Ltd. and ICICI Bank Ltd. underperformed.

The NSE Nifty 50 ended 117.25 points or 0.51% lower at 22,795.9, while the BSE Sensex closed 424.9 points or 0.56% lower at 75,311.06.

Intraday, Nifty fell 0.84% to crack below the crucial support of 22,800, while Sensex lost 0.82% to stay marginally above 75,100.

This week, the 50-share Nifty shed 0.64%, dragged by Mahindra & Mahindra, Bharti Airtel Ltd., and Dr. Reddy’s Laboratories Ltd. The 30-share Sensex lost 0.92%.

India's GDP data will be released on Feb. 28. India’s GDP data may show growth rebounded in the fourth quarter but Bloomberg estimates still put it below potential. Lower borrowing costs and income-tax cuts should provide a boost going forward.

As per Bloomberg estimates, India’s GDP growth likely rebounded to 5.9% year on year in the fourth quarter of fiscal 2024-25 from 5.4% in the third quarter of fiscal 2024-25. That would still be a slow pace relative to potential growth, which we estimate at 7.0%. 

Looking ahead, the Maha Kumbh festival lifted activity in January and this is likely to have carried over into February. Stimulus—a rate cut earlier this month and income-tax cuts effective in the fiscal year starting in April—is likely to provide a tailwind. "We see growth accelerating to 7.0% in the first quarter of fiscal 2025-26," as per Bloomberg.

The week will begin with South Korea's Monetary Policy Decision and Policy Rate Outlook on Feb. 25. Bloomberg expects the Bank of Korea to resume its easing cycle in Asia’s week ahead to support a struggling economy. "We expect the Bank of Korea to cut the base rate by 25 basis points to 2.75%, resuming its easing cycle as economic risks escalate," as per Bloomberg estimates.

Australia CPI will be released on Feb. 26. Australia’s January CPI report is likely to show headline inflation picking up, but remaining in the Reserve Bank of Australia’s 2%-3% target band.

The week to end with Tokyo CPI report, Tokyo Inflation Gauges and Japan Industrial Production. Tokyo’s February CPI report will likely show underlying inflation momentum continuing to pick up, as per Bloomberg report.

The upcoming week will witness muted activity in the primary markets, in both the mainboard and SME segments. Investors will see one main board listing, as Quality Power Electrical Equipments Ltd. will be listing on Feb. 21.

The upcoming SME IPOs this week are Beezaasan Explotech Ltd., Nukleus Office Solutions Ltd. and Shreenath Paper Ltd. The current active SME IPOs are HP Telecom India Ltd. and Swasth Foodtech Ltd.

Shares of ASM Technologies Ltd., Prithvi Exchange (India) Ltd., SBI Cards and Payment Services Ltd., Bhatia Communications & Retail (India) Ltd., International Gemmological Institute India Ltd., Panchsheel Organics Ltd. and Power Finance Corporation Ltd. will turn ex-date for the issue of interim dividends.

Meanwhile, shares of Oasis Securities Ltd. and RDB Realty and Infrastructure Ltd. will turn ex-date for their stock split.

The table below shows the full list of corporate actions for the upcoming week.