05 September,2026 01:02 PM IST | Mumbai | mid-day online correspondent
Representational Image. File pic.
The domestic equity benchmark indices extended their losses for the fourth consecutive week as elevated crude oil prices amid renewed tensions between USA and Iran dampened investor sentiment.
The benchmark indices declined on four of the five days this week on weak global cues due to the geopolitical tensions and a hawkish stance of the US Federal Reserve.
During the week, the Sensex declined 749.08 points or 0.97 per cent, while the Nifty lost 277.95 points or 1.15 per cent.
"The risk appetite of domestic investors turned decidedly cautious as Indian equities traded with a volatile undertone, pressured by two external concerns; rising crude oil prices and a deepening global bond rout. Compounding this, market participants took their cues from a shifting narrative among US Fed officials," Vinod Nair, Head of Research, Geojit Investments said.
"Early in the week, the hawkish signalling from the Jackson Hole address weighed heavily on sentiment. However, towards the close, Fed Governor Waller's remarks flagging early signs of disinflation and an inclination to hold rates steady offered some respite, even as an underlying caution lingered," he added.
On Friday the 30-share BSE Sensex advanced 362.57 points, or 0.48 per cent, to settle at 76,515.43. The 50-share NSE Nifty too traded in the positive territory, climbing 24.25 points, or 0.10 per cent, to end at 23,897.70.
During the week, India reported a GDP growth of 7.8 per cent for the first quarter of the current fiscal year, beating market estimate. However, the strong growth momentum was overshadowed due to the renewed military action between USA and Iran, fuelling concerns of a possible disruption in oil supply.
India is the third largest importer and consumer of crude oil and a rising crude oil price has an impact on the country's import bills.
Brent crude, the global oil benchmark traded at USD 96.28 or 0.80 per cent higher.
"Among sectors, the Auto index lost the most, shedding over 3.8 percent, whereas the Oil and Gas index outperformed, rallying 1.30 percent," Amol Athawale, VP Technical Research, Kotak Securities said.
Metals also outperformed, while Realty, Healthcare and Chemicals were among the key laggard, according to Siddhartha Khemka Head of Research, Wealth Management, Motilal Oswal Financial Services.
"Broader markets were mixed, with the Nifty Midcap 100 declining 0.2 per cent and Smallcap 100 gaining 0.2per cent," he said.
According to Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking, Foreign Institutional Investors (FIIs) stayed on the sell side for a third consecutive week during last week, offloading Rs 56.1 billion worth of Indian equities, while Domestic Institutional Investors (DIIs) extended their buying streak with net purchases of Rs 231.6 billion.
"FIIs were net seller for three sessions during last week including the quarterly MSCI index rebalancing session on Monday, August 31, 2026. While DIIs were net buyer in all five sessions during last week," he said.
On the domestic front, the robust activity in the primary stock market with a slew of launches is expected to attract investment opportunities.
"The primary market remains active, with 11 mainboard IPOs scheduled to open next week, targeting over Rs 7,000 crore in aggregate. Several companies are also lined up for listing, keeping primary-market activity elevated despite the cautious secondary-market backdrop," Khemka said.
The geopolitical tensions in the Middle East and the rising crude oil prices remain a key overhang for the market according to analysts.
Moreover, investors will also watch for further cues from the US Federal Reserve and its interest rate outlook.
"Looking ahead, with consensus expectations for a softer August US core inflation print , investors will be focused on whether incoming US macro data can reinforce the case for a Fed pause. With this in view, the US employment data, followed by next week's US CPI print will be crucial in shaping the interest-rate outlook and bond-yield volatility," Nair said.
