Stock markets opened sharply lower on Thursday, with benchmark indices under pressure as rising crude oil prices, continued foreign investor selling and a weak rupee weighed on sentiment.
The BSE Sensex was down 855.79 points, or 1.10%, at 76,640.57 around 9:33 am, while the Nifty 50 fell 276.30 points, or 1.14%, to 23,946.45.
The weakness was broad-based, with all major sectoral indices trading in the red and most frontline stocks declining.
OIL SURGE HITS SENTIMENT
One of the biggest triggers for today’s fall is the sharp rise in crude oil prices, which have surged above $120 per barrel.
Higher oil prices are a concern for India as it imports most of its crude requirements. This raises inflation risks, widens the current account deficit and impacts corporate margins.
This is clearly reflecting in market sentiment, with investors turning cautious despite ongoing earnings announcements.
FII SELLING AND WEAK RUPEE ADD PRESSURE
Foreign institutional investors (FIIs) continued to sell equities, offloading shares worth around Rs 2,468 crore in the previous session.
While domestic institutional investors (DIIs) provided some support with buying of Rs 2,262 crore, the overall sentiment remains weak.
At the same time, the rupee has weakened past the 95 mark against the US dollar, opening at 95.02 compared to the previous close of 94.8450.
A weaker rupee makes imports costlier and adds to inflation concerns, further weighing on markets.
HAWKISH FED SIGNALS
Global cues also remain negative. The US Federal Reserve kept interest rates unchanged, but rising inflation concerns linked to the ongoing geopolitical tensions have reduced expectations of rate cuts in 2026.
Higher US bond yields, with the 10-year yield around 4.4%, are making US assets more attractive and could lead to further capital outflows from emerging markets like India.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said there are two key headwinds for the market.
“One, Brent crude at $120 threatens to worsen India’s macros; the downside risk to growth and upside risk to inflation will rise if crude price remains elevated at this level,” he said.
“Two, strong results from AI majors in the US and South Korea could extend the AI trade, leading to further portfolio outflows from India,” he added.
He also noted that while the Fed’s decision was expected, rising US bond yields could still have a slightly negative impact by encouraging capital outflows.
BROAD-BASED SELLING ACROSS SECTORS
Selling was seen across sectors. Nifty Auto fell 1.94%, Financial Services declined 1.25%, and PSU Bank index dropped 1.64%. Realty was down 1.56%, while Metal slipped 1.29%.
Consumer Durables fell 1.23%, Oil & Gas index declined 0.93%, and FMCG was down 0.83%. Even relatively defensive sectors like healthcare slipped 0.48%.
The broader market also remained weak. Nifty Midcap 100 declined 1.09%, while Nifty Smallcap 100 fell 0.49%.
India VIX rose 4.55% to 18.23, indicating rising volatility and nervousness among investors.
SENSEX STOCKS: FEW GAINERS, MANY LOSERS
Among Sensex stocks, only a handful were trading higher. Bajaj Finance led gains, rising 3.23%, followed by Bajaj Finserv (1.13%). Infosys and Tech Mahindra were marginally positive.
However, most stocks were in the red. Eternal fell 2.79%, IndiGo declined 2.83%, UltraTech Cement dropped 2.53%, M&M slipped 2.19%, and Axis Bank fell 2.08%.
Adani Ports declined 1.91%, HDFC Bank fell 1.73%, and Reliance Industries dropped 1.14%, adding pressure on the index.
Markets are likely to remain volatile in the near term as investors track crude oil prices, global cues and currency movements.
While earnings may provide stock-specific opportunities, the broader direction will depend on how these macro risks evolve.
