Macroeconomic Data, Global Trends, FII Activity To Drive Indian Stock Market This Week: Analysts

Macroeconomic data announcements, global trends and trading activity of foreign investors would be major driving factors for market movement this week, analysts said.

Unabated capital infusion by domestic institutional investors have supported the positive trend in the stock market last week, traders said.

'This week is expected to be data-heavy, both domestically and globally, as markets enter the early phase of the earnings season. In India, investors will track the final readings of the HSBC Services PMI (Purchasing Managers' Index) and Composite PMI. Globally, key US macro data and releases from China will be closely watched for signals on growth, demand, and inflation trends,' Ajit Mishra -- SVP, Research, Religare Broking Ltd -- said.

Last week, the BSE benchmark jumped 720.56 points, or 0.84 per cent, and the NSE Nifty climbed 286.25 points, or 1.09 per cent. The 50-share Nifty hit its all-time peak of 26,340 on Friday.

'Market's focus is set to shift toward the Q3 earnings season, with traders likely to build positions selectively ahead of results from key index heavyweights. Domestically, Services and Composite PMI data will provide further insights into business momentum and employment trends...,' Ponmudi R, CEO -- Enrich Money, an online trading and wealth tech firm, said.

Globally, attention will remain on US non-farm payrolls and unemployment data, which could shape expectations around the Federal Reserve's rate path and overall risk appetite, he said.

While short-term volatility around global data releases cannot be ruled out, the underlying market structure remains firmly positive, encouraging a selectively optimistic approach as 2026 unfolds, Ponmudi added.

TCS and HCL Technologies would begin the Q3 earnings season on January 12.

'The outlook for Indian markets this week appears constructively positioned as markets enter 2026 with focus on domestic growth momentum and global economic health shaping investor sentiment for the year ahead.

'While global cues particularly trends in US interest rates, currency movements, and geopolitical developments will continue to influence short-term sentiment, the primary driver for Indian markets is increasingly domestic fundamentals, including earnings visibility, government spending and consumption trends,' Ravi Singh, Chief Research Officer at Master Capital Services Ltd, said.

Foreign Institutional Investors (FIIs) turned buyers on Friday, as they picked up equities worth Rs 289.80 crore, according to exchange data.

Movement of rupee against the US dollar and Brent crude, the global oil benchmark, would also be tracked by investors this week.

Vinod Nair, Head of Research, Geojit Investments Ltd, said, 'For the week ahead, investors will give attention to US payroll and unemployment data for global market direction. Overall sentiment is expected to stay constructive, though markets may move within a steady range as participants wait for clearer earnings-led triggers and clarity on the India-US trade deal.'

'The Indian equity market has commenced 2026 on a stellar note, with the Nifty scaling fresh all-time high. While January has historically been a month of consolidation or bearishness, the current momentum suggests a decisive break from this seasonal trend. Supported by robust underlying factors and positive sentiment, the market structure remains firm,' Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd, said.