Indian equity markets showed signs of recovery from their sharp opening decline, with Sensex declining 386.82 points or 0.52% to 74,840.44 and Nifty 50 dropping 135.80 points or 0.58% to 23,510.65 as of 11:25 IST. According to Business Standard, this represents a significant improvement from the earlier session lows when Nifty had fallen below the crucial 23,400 mark during intraday trading. The BSE 150 MidCap Index tumbled 1.23% and BSE 250 SmallCap Index dropped 2.17%, indicating that broader markets continued to underperform frontline indices. Market breadth remained negative with 882 shares rising and 3,138 shares falling on the BSE, while 200 shares remained unchanged.
Global oil prices continued their upward trajectory, with Brent crude for July 2026 settlement rising $1.44 cents or 1.32% to $110.70 a barrel, as reported by Business Standard. This development stoked further concerns about crude supply and led to sharp spike in prices. The escalating tensions in West Asia and heightened geopolitical uncertainty drove this surge, with U.S. President Donald Trump warning Iran to "get moving, FAST" in a Truth Social post, raising fears of further escalation in the Middle East and potential disruptions to global oil supplies. Oil prices have remained highly volatile, with concerns mounting over potential supply disruptions at the Strait of Hormuz, a critical maritime chokepoint that handles nearly 20% of global oil flows.
The Indian rupee came under sharp pressure, edging lower to 96.3200 against the US dollar compared with its previous close of 95.8100, as reported by Business Standard. The currency also touched an all-time intraday low of 96.3350 during the session, extending its losing streak and becoming one of Asia's weakest-performing currencies this year. The currency weakness was driven by a surge in global crude oil prices above $110 per barrel and continued strength in the dollar. Anil Kumar Bhansali, Head Of Treasury, Finrex Treasury Advisors LLP noted that with the rise in dollar index due to simmering Iran tensions, the dollar Index has risen to 99.36 levels. For India, a falling rupee creates multiple challenges since the country imports a large amount of crude oil and several commodities, a weaker currency increases import costs and raises inflation pressure.
The Nifty Media index declined 2.37% to 1,402.10, reversing gains from the past two trading sessions when it had risen 2.89%, according to Business Standard. Major media stocks witnessed significant selling pressure, with Zee Entertainment Enterprises down 5.37%, Prime Focus falling 4.99%, Saregama India declining 3.87%, and Network 18 Media & Investments dropping 2.73%. Other media companies including Sun TV Network (down 2.68%), Hathway Cable & Datacom (down 2.24%), D B Corp (down 2.06%), PVR Inox (down 0.61%), and Tips Music (down 0.05%) also declined during the session.
Foreign fund weakness remained a major drag on market sentiment, with Foreign Portfolio Investors (FPIs) only buying ₹1,329.17 crore worth Indian equities on May 18, 2026. As reported by ET Now, FPI buy orders worth ₹16,299.60 crore slightly exceeded their sell of ₹14,970.43 crore, marking lukewarm sentiment. In contrast, Domestic Institutional Investors (DIIs) were the net seller, recording a net outflow of ₹1,958.82 crore on the same day, with total sale of ₹16,920.70 crore against purchase of ₹14,961.88 crore. The sharp depreciation also raises concerns over foreign investor flows, as global funds often reduce exposure to emerging markets during periods of currency weakness and geopolitical uncertainty.
