MUMBAI: Geopolitical tensions between India and Pakistan, in the backdrop of the Pahalgam terror attack, trading trends by foreign funds, quarterly results by companies in India and the US, and trading trends in the US markets will decide how investors on Dalal Street behave in the truncated trading week.

The volatile nature of Indo-Pak relations, especially after the suspected backing of the terrorists by Pakistani actors, took its toll on the market on Friday, pulling the sensex and Nifty down by about 0.8% each, while mid and smallcap stocks were hit even worse. The day’s selling also wiped out over Rs 8 lakh crore worth of investors’ wealth. If Indo-Pak tensions continue and skirmishes at the border escalate, there could be more downside to the market, brokers and traders said on Sunday.
Surprisingly, foreign funds are betting big on India despite the tensions at the border. In the last eight sessions, foreign portfolio investors (FPIs) net bought Indian stocks worth nearly Rs 32,500 crore. According to VK Vijayakumar, chief investment strategist, Geojit Investments, there is a distinct trend reversal in FPI strategy in India. The week will also see many blue-chip companies announce results.