Foreign institutional investors (FIIs) were net sellers in the Indian stock markets this week, offloading Rs 7,180 crore, while domestic institutional investors (DIIs) were net buyers, purchasing Rs 8,640 crore. The Deputy Vice President-Research at Bajaj Broking, Pabitro Mukherjee, mentioned that foreign institutional flows might remain volatile until there is more clarity on geopolitical situations and stable crude oil prices. This stability is crucial for restoring investor confidence and improving equity market outlook.
Benchmark Indices experienced a sharp decline due to escalating geopolitical tensions, rising crude oil prices, tariff uncertainties, and the Indian rupee weakening against the US dollar. Rising oil prices pose a significant risk to economic stability by fueling inflation, increasing input costs, and pressuring corporate profit margins and near-term earnings expectations. Nifty closed the week at 23,767.5 levels, down by 2.3 percent, after starting the week on a negative note and closing lower for all five sessions.
Vinit Bolinjkar, Head of Research at Ventura, highlighted that the trading week ended amidst intense geopolitical tensions, with Brent crude surpassing $100 to settle at $100.40 per barrel due to escalating US-Iran conflict risks. Despite stable USD/INR rates and robust domestic retail liquidity, surging energy costs and supply-chain concerns have increased volatility. Markets are closely watching upcoming corporate earnings and defensive allocation strategies to navigate near-term macro challenges.
Investors in the upcoming week will monitor crude oil price movements and developments in the US-Iran geopolitical tensions. Analysts noted that the focus will also remain on the Q1 FY27 earnings season.
