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Key gauges end sharply lower as oil prices rise amid US-Iran tensions
Sep-28-2026

Indian equity benchmarks ended sharply lower on Monday, with the Sensex and Nifty falling over one and half percent each as the escalating Iran-US conflict pushed oil prices and bond yields higher, spooking investors. Pressure on the rupee along with foreign fund outflows also hit investors' sentiment. Traders remained on sidelines ahead of the month-end expiry of the Nifty and Bank Nifty contracts on Tuesday. 

Some of the important factors in trade:

El Nino threatens rabi crops in rainfed areas, may affect foodgrain output: Agriculture Secretary Atish Chandra said the upcoming rabi (winter) season is likely to be challenging for rainfed areas due to the El Nino weather pattern, and foodgrain production could be affected.

FDI equity inflows in India rises 6% to $19.81 billion in Q1FY27: The Department for Promotion of Industry and Internal Trade (DPIIT) data has shown that foreign direct investment (FDI) equity inflows in India rose 6 per cent to $19.81 billion in April-June quarter (Q1) of current fiscal year 2026-27 (FY27).

India can achieve over 10% economic growth with greater technology adoption: Stressing the need for greater adoption of technology and innovation across sectors, Union Finance Minister Nirmala Sitharaman has expressed confidence that India could achieve economic growth of more than 10 per cent. 

India's financial, external sectors continue to draw strength from resilient domestic economy: Reserve Bank of India (RBI) in its latest Bulletin has said that India's financial and external sectors continue to draw strength from a resilient domestic economy. However, it flagged the escalating geopolitical tensions and weather-related uncertainties as the key risks. 

Global front: European markets were trading higher despite U.S.-Iran tensions and rising oil prices. Asian markets ended mostly lower as Middle East tensions persisted, hawkish signals from Federal Reserve policymakers bolstered the case for another Fed rate hike this year, and new data showed China's industrial profit growth slowed further in August. 

Finally, the BSE Sensex fell 1124.02 points or 1.52% to 72,771.72 and the CNX Nifty was down by 360.25 points or 1.56% to 22,780.25.

The BSE Sensex touched high and low of 73,740.85 and 72,716.23, respectively. There was 1 stock advancing against 29 stocks declining on the index. 

The top losing sectoral indices on the BSE were Telecom down by 2.30%, Power down by 2.30%, Utilities down by 2.27%, PSU down by 2.09% and Realty down by 2.08%, while there was no gaining sectoral indices on the BSE.  

The lone gainer on the Sensex was Infosys up by 0.20%. On the flip side, Larsen & Toubro down by 2.81%, Power Grid down by 2.62%, Adani Ports &SEZ down by 2.38%, HDFC Bank down by 2.30% and Hindustan Unilever down by 2.27% were the top losers.

Meanwhile, Reserve Bank of India (RBI) in its article on 'State of the Economy' published in the latest Bulletin has said that India's financial and external sectors continue to draw strength from a resilient domestic economy. However, it flagged the escalating geopolitical tensions and weather-related uncertainties as the key risks. It noted that the renewed conflict between US and Iran in September has pushed up crude oil prices sharply, raising the prospect of fresh supply-chain disruptions and renewed inflationary pressures. Alongside, the rise in sovereign yields in some of the major advanced economies has put pressure on government finances.

Notwithstanding the ongoing global turbulence, the article said the Indian economy recorded robust growth of 7.8 per cent in Q1:2026-27, driven by domestic consumption and investment. It further said system liquidity remained in surplus in August and surged further in the first half of September as banks tapped the Reserve Bank's Foreign currency non-resident (Bank) [FCNR(B)] swap facility, before moderating later in the month due to tax-related outflows. It said money supply growth accelerated in August on account of a rapid increase in aggregate deposits. Credit growth maintained its momentum while deposit growth picked up.

According to the article, Indian equity markets remained subdued in August and September as geopolitical tensions and elevated bond yields weighed on investor sentiment. The current account deficit remained moderate in Q1:2026-27, supported by robust services exports and remittance flows. It said foreign direct investment (FDI) flows strengthened in July with net FDI reaching its highest monthly level in five years, and added that net inflows under non-resident deposits rose sharply. Various capital flow measures announced in June supported the accumulation of foreign exchange reserves, which rose to $765.9 billion as of September 18, 2026. On the other hand, the article said, foreign portfolio investment (FPI) registered net outflows in September after witnessing inflows in August, on re-escalation of the West Asia crisis and rising global bond yields.

CNX Nifty touched high and low of 23,080.25 and 22,762.20, respectively. There were 3 stocks advancing against 47 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy's Labs. up by 1.67%, Infosys up by 0.30% and HDFC Life Insurance up by 0.11%. On the flip side, Tata Motors Passenger down by 3.00%, Adani Enterprises down by 2.93%, JIO Financial Services down by 2.86%, Power Grid down by 2.84% and Larsen & Toubro down by 2.83% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 30.78 points or 0.29% to 10,726.03, France’s CAC rose 4.3 points or 0.05% to 8,082.10 and Germany’s DAX gained 1.66 points or 0.01% to 25,410.30.

Asian markets ended mostly lower on Monday as surging crude price and bond yields weighed on investors sentiments. The Brent crude oil prices have surged past $107 a barrel mark after US President Donald Trump rejected Iran's proposal to reopen the Strait of Hormuz. He has also threatened to attack Iran after US mid-term elections. Further, the high crude oil prices have sparked worries about soaring inflation and tougher monetary policies by central banks. Besides, Hawkish outlook by Bank of Japan and global macro-economic headwinds have made market participants nervous. Moreover, Chinese tech shares fell to a 13-month low due to fears of new US sanctions on local transceiver makers and on rumour that Beijing might let companies buy Nvidia chips. Meanwhile, Taiwanese market remained closed for teacher's day.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

3,823.62

-64.75

-1.67

Hang Seng

24,642.51

132.42

0.54

Jakarta Composite

6,147.86

-94.03

-1.53

KLSE Composite

1,670.02

-1.60

-0.10

Nikkei 225

65,877.62

-486.58

-0.73

Straits Times

5,729.02

17.90

0.31

KOSPI Composite

6,889.74

-191.18

-2.77

Taiwan Weighted

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