Five Triggers, One Market Mood: What Could Dictate Dalal Street’s Next Move |

Updated: January 25, 2026 11:49

Image Source: The Economic Times

Indian equities enter a volatile week with five key triggers: the Union Budget 2026, the US Federal Reserve’s policy meeting, Q3 corporate earnings, derivatives expiry, and global geopolitical risks. These factors will dictate investor sentiment, with caution prevailing after recent profit booking and foreign fund outflows.

Key Highlights

Union Budget 2026: Investors are bracing for fiscal announcements, particularly on taxation, infrastructure spending, and capital market reforms. Any deviation from expectations could spark sharp moves.
US Federal Reserve Meeting: Global markets await clarity on interest rate policy, with potential ripple effects on foreign fund flows into India.
Q3 Corporate Earnings: Mixed results so far have kept sentiment subdued. Banking and IT sectors are under close watch for margin pressures and growth outlook.
Derivatives Expiry: The upcoming January series expiry is expected to add volatility, with traders adjusting positions ahead of the Budget.
Geopolitical Concerns: Persistent global trade tensions and Middle East instability continue to weigh on investor confidence.

Market Recap

Last week, Indian equities swung between gains and losses before ending on a bearish note. On Friday, the Sensex tumbled 770 points (0.94%) to 81,537.70, while the Nifty 50 slipped 241 points (0.95%) to 25,048.65. Profit booking, foreign investor selling, and pre-Budget anxiety drove the pullback.

Budget Watch

The Union Budget is the most significant domestic event. Market participants expect measures to boost consumption, incentivize manufacturing, and support infrastructure. Any announcement on capital gains tax or fiscal deficit targets will be closely scrutinized.

Global Cues

The US Fed’s policy stance remains critical. If the Fed signals a prolonged high-rate environment, it could trigger capital outflows from emerging markets like India. Conversely, dovish commentary may provide relief to equities.

Corporate Earnings

Q3 results have been uneven. While metals and select PSU banks showed resilience, IT majors reported muted growth amid global demand concerns. Investors will track sectoral earnings to gauge the broader economic momentum.

Outlook

This week is expected to be highly volatile, with traders balancing domestic fiscal cues against global monetary policy. Analysts advise caution, suggesting that investors adopt a stock-specific approach rather than broad market bets until clarity emerges post-Budget and Fed meet.

Sources: Mint, Hindustan Times, Economic Times, Business Standard, PTI

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