Indian equity markets opened on a cautious note Friday morning, with NIFTY50 opening at 23,035.00 and trading at 23,067.45, up just 4.35 points or 0.02% as of 9.20 am, following Thursday's steep sell-off. The Sensex opened at 73,525.92 and was quoting at 73,671.44, up 90.90 points or 0.12%, showing marginal recovery after the previous session's sharp decline. This comes a day after NIFTY50 suffered its steepest single-session fall since July 8, closing at 23,063.10, down 383.70 points or 1.64%, with BSE SENSEX ending at 73,580.54. The GIFT Nifty October 2026 futures were trading at 23,095-23,115, signalling a flat-to-muted opening for Friday's session, according to The Hindu BusinessLine.
The session's top gainers on the Nifty 50 included Bajaj Finserv (₹1,775.10, +0.73%), Shriram Finance (₹996.30, +0.64%), Power Grid (₹268.05, +0.62%), Bajaj Auto (₹11,275.00, +0.60%) and Axis Bank (₹1,193.00, +0.55%). On the losing side, Infosys (₹993.80, -2.04%) and TCS (₹2,047.40, -1.90%) led the decline, followed by ONGC (₹236.02, -1.25%), Wipro (₹161.85, -1.09%) and Tech Mahindra (₹1,530.00, -0.84%). Thursday's selloff was broad-based, with all major sectoral indices closing in the red, with the Financial Services Index being the hardest hit, shedding over 4.35%, weighed down by concerns over the Insurance Regulatory and Development Authority of India's (IRDAI) proposed caps on insurance commissions. IT stocks continued to bleed into Friday's session, with the sector under pressure from rising US bond yields and a stronger dollar.
The global macro backdrop remained hostile, with the US 10-year Treasury yield touching 5.22% overnight, a 19-year high, while the 30-year yield climbed to 5.48%, a 22-year high. Brent crude, despite easing slightly, remained elevated above $105 per barrel, following a Houthi missile attack on Saudi Arabia that renewed supply concerns. Asian markets traded mixed on Friday, with Japan's Nikkei gaining approximately 1.2%, while Hong Kong was indicated weaker and South Korean markets remained shut for the Chuseok holiday. Wall Street ended nearly flat overnight, with the S&P 500 down 0.02%, the Nasdaq marginally positive, and the Dow Jones declining 0.31%. "High crude and stubborn inflation have increased the probability of another rate hike by the Fed in October," said Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments. "Only a sharp decline in crude prices can help the market rally now."
According to The Hindu BusinessLine, wholesale inflation surged to 9.92%, while retail inflation rose to 4.82%, the highest since December 2024. The energy shock is no longer a threat on the horizon but is fully embedded in India's price indices, with any remaining expectation of an RBI rate cut now set aside. IRDAI proposed sweeping changes to insurance distribution commissions, with PB Fintech and the broader insurance distribution space falling sharply. Foreign institutional investors (FIIs) were aggressive sellers on Thursday, offloading equities worth ₹5,027 crore, their largest single-day sell in the month, while domestic institutional investors (DIIs) provided partial support, buying ₹4,301 crore worth of shares. "Domestic buying absorbed most of the outflow but could not prevent the breakdown, indicating that overseas selling remains concentrated enough to pressure index heavyweights," said Hariselvan Radhakrishnan, Founder and CEO of HST Wealth.
On the technical front, analysts flagged 23,000 as the most critical near-term support for the Nifty, backed by heavy put open interest at that level. As long as the market is trading below 23,300/74,300, weak sentiment is likely to continue, said Shrikant Chouhan, Head of Equity Research at Kotak Securities, adding that a break below 23,000 could drag the index toward 22,800–22,650. Bank Nifty, which closed at 55,438.50 on Thursday, down 1,110 points or 1.96%, faces resistance at 55,700–56,000, with support at 55,000–54,800. India VIX stood at 12.68, reflecting increased demand for hedging, while the Put-Call Ratio at 0.73 indicated defensive market positioning. A sustained recovery would require the Nifty to reclaim 23,300 and Bank Nifty to return above 56,000, with long-term investors advised to utilise current weakness to accumulate fundamentally sound stocks at attractive valuations.
