The Indian stock market will monitor the geopolitical developments this week after India and Pakistan reached an understanding to stop military actions.

Macroeconomic data announcements, Q4 earnings, trading activity of foreign investors, and global market trends are also likely to influence sentiments, traders said.

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Despite recent tensions between India and Pakistan, analysts believe these events have not significantly deterred foreign investment in India. The country’s $4 trillion economy and strong domestic consumption continue to attract investments.

Investors will be closely monitoring the release of inflation data and consumer price index (CPI) figures this week. Analysts predict a moderate decline in CPI, which may influence monetary policy decisions by the Reserve Bank of India (RBI).

Further, the defensive sectors and large-cap stocks are expected to outperform in the near term. The consumer, BFSI, and metal sectors may remain in focus.

Eyes will also be on FIIs, who turned negative in Friday’s trading session after being continuous net buyers for the last two weeks.

Several major companies like Tata Steel, Bharti Airtel, Gail, Hero MotoCorp, Tata Motors, Lupin, and BHEL are scheduled to announce their quarterly results.

Last week, the BSE benchmark dropped 1,047.52 points or 1.30%, and the NSE Nifty declined 338.7 points or 1.39%.

After India launched missile strikes on Pakistan, codenamed Operation Sindoor, targeting militant groups Jaish-e-Mohammed and Lashkar-e-Taiba last week, the shares opened lower due to heightened tensions, but partially recovered from early losses.

The NSE and BSE temporarily limited access to their websites for overseas users due to potential cyber threats.