Indian benchmark indices ended Tuesday's session marginally lower as BSE Sensex closed flat, down 12.99 points, or 0.02%, to settle at 76,944.28 and the NSE Nifty slipped 24.60 points, or 0.10%, to end at 24,055.80 on the weekly expiry day. During intraday trading, the benchmark dropped 301.15 points, or 0.39%, to 76,656.12 before recovering most of the losses during the Closing Auction Session (CAS) introduced by SEBI from August 3. The Nifty was down almost 100 points at 23,980.55 at 3:20 p.m. before the recovery. Market breadth remained negative as 2,343 shares fell against 1,835 that rose, while 249 shares remained unchanged. Among the 30 Sensex firms, Maruti, State Bank of India, InterGlobe Aviation, Bajaj Finserv, Mahindra & Mahindra and Axis Bank were the major laggards, while ITC, HCL Tech, Infosys and Bharti Airtel were among the winners. Foreign Institutional Investors (FIIs) offloaded equities worth ₹7,985.88 crore on Monday, according to exchange data.
Brent crude, the global oil benchmark, jumped 1.7% to around $92 per barrel, with WTI gaining more than 2% to near $88 on renewed US-Iran tensions. Higher crude prices are particularly important for India because the country imports most of its oil, with a prolonged rise in prices potentially increasing costs for businesses and putting pressure on inflation. US forces struck Iranian rocket launchers on Larak Island in the Strait of Hormuz, while Iran retaliated with attacks on US military targets in Jordan. The escalation has raised concerns over prolonged supply disruptions through the key oil shipping route, with shipping activity falling sharply amid the hostilities. MCX crude futures settled above ₹8,300 per barrel. The renewed conflict has also increased uncertainty over the outlook for the Strait of Hormuz, through which a significant share of global oil shipments normally passes. Higher oil prices have revived concerns over persistent inflation, potentially strengthening the case for tighter monetary policy, with the US 10-year Treasury yield rising to around 4.79%.
Despite global headwinds, India's economy grew at a faster-than-expected 7.8% in the April-June quarter, showing resilience in the face of concerns that the war in Iran and resulting global uncertainty could weigh on domestic economic momentum. As per The Hindu BusinessLine, "September opened with India's economy delivering exactly the kind of number the market needed to hear. And then refusing to rally on it," said Sarvam Goel, Founder of Pocketful, pointing to crude at $91 and the US 10-year yield near 4.79%. "The global backdrop is simply too heavy right now," he noted. However, escalating geopolitical tensions in West Asia and a more hawkish Federal Reserve have renewed concerns about inflation and the prospect of elevated interest rates for an extended period. Growing expectations that the US Federal Reserve could keep monetary policy tighter for longer are also weighing on risk appetite across emerging markets, according to market experts.
Sectoral sentiment remained mixed, with IT and FMCG gaining around 1% and 0.9% respectively, while Auto, Pharma, Realty, PSU Banks and Consumer Durables fell more than 1% each. In the broader market, the Nifty Midcap 100 fell 1.39% and the Nifty Smallcap 100 declined 0.23%. Notable individual performers included ITC surging 4.3% following ITC Infotech's acquisition of a 22.1% stake in Happiest Minds, Bharti Airtel and Adani Ports among the other top gainers, while Shriram Finance, Maruti and Nestle were the key laggards. TBZ surged 20% to a record high after GRT Jewellers agreed to acquire a 74.12% stake for up to ₹1,034 crore. UltraTech Cement's commencement of commercial wire and cable production at its Gujarat plant weighed on Polycab, KEI and Havells. Steel Strips Wheels jumped 7.29% after reporting its second consecutive record monthly turnover in August 2026, with net turnover rising 53.6% to ₹592.92 crore from ₹385.98 crore recorded in August 2025.
The rupee was a relative bright spot, gaining 21 paise to close at 84.95 against the US dollar, marking its third straight session of gains and its strongest level in two months. The currency was supported by dollar supplies from the Reserve Bank of India and the strong GDP print. Gold, meanwhile, slipped, with MCX gold declining around ₹1,900 to ₹1,52,500, while COMEX gold fell nearly $75 to $4,370. Ajit Mishra, SVP Research at Religare Broking, recommended a "sell on rise" approach on the Nifty, citing the sharp rise in crude oil prices driven by escalating tensions in West Asia and concerns over supply disruptions. Markets will now track US non-farm payroll data due later this week for cues on the Federal Reserve's rate trajectory. Domestically, 24,000 remains a key support for the Nifty, while 24,200-24,250 is likely to act as resistance in the near term.
