Oil Shock Rattles D-Street
Brent crude's surge past $100 a barrel for the first time since July 24, driven by escalating Iran-US and Iran-Saudi tensions including reported Iranian strikes near US military assets, has become the dominant macro overhang for Indian equities. The Sensex crashed 813 points and the Nifty 50 slipped below the psychologically important 23,500 mark, closing at 23,431.5 (-1.46%), its third straight losing session and lowest level in three months. Higher crude directly threatens India's import bill, currency stability and inflation trajectory, three levers that matter enormously for a net oil-importing economy.
IT Index Suffers Worst Day in Months
The Nifty IT index plunged 3.60% to 28,913.95, its biggest single-day fall in three months, as Infosys, TCS, HCL Tech, Tech Mahindra and Wipro all slid on renewed risk-off sentiment and fresh worries over H-1B visa fee hikes. Coforge led the selloff with a near 9% drop after chairman OP Bhatt's resignation following an audit, compounding sector-wide pressure. CNBC-TV18 reports IT stocks have collectively shed over ₹1 lakh crore in market capitalisation this week, with HDFC Bank and Infosys alone accounting for more than half of the Nifty50's nearly 10% decline this year.
Rupee Breaches 95, RBI Steps In
The rupee fell to 95.09-95.11 against the dollar, breaching the 95 mark as surging crude and FII outflows weighed on the currency. Reports indicate the RBI intervened via spot dollar sales and FX swaps to drain excess rupee liquidity and cap volatility. Indian government bonds also weakened as the crude spike revived inflation concerns, darkening the near-term interest rate outlook even as banking system liquidity surpluses cushioned some selling pressure.
FIIs Sell, DIIs Absorb the Blow
Foreign institutional investors stepped up selling as Indian markets extended their slide for a third consecutive session, while domestic institutions remained net buyers, a familiar pattern that has repeatedly offset outflows this year. This tug-of-war between foreign selling and domestic buying continues to be a key structural feature of the current market phase, and its persistence will likely shape how deep the current correction runs.
NSE IPO Shrinks Further
The National Stock Exchange has revised its Sebi filing to cut its IPO size to roughly ₹23,500 crore, with the offer-for-sale portion trimmed to 5.25-5.5% of paid-up capital as some existing shareholders, including Morgan Stanley, reduced their sale size. The price band has also been lowered to an indicative ₹1,700-1,785 per share, valuing NSE near ₹4.42 lakh crore, a marked step down from earlier chatter that would have made it India's largest-ever listing, a mantle Hyundai Motor India may now retain.
Inflation Data and Policy Watch Ahead
A Reuters poll cited by Economic Times suggests India's August CPI inflation may hit a 20-month high near 4.80%, driven by food and fuel prices, with crude's climb past $100 adding fresh upside risk. This comes as investors await both US and Indian policy rate decisions, making the inflation print an important data point for gauging how much room the RBI has to maneuver amid currency and bond market stress.
Corporate Crosscurrents Amid the Selloff
Away from the broad market weakness, select corporate developments stood out: L&T Energy Hydrocarbon Offshore secured a large order worth up to ₹5,000 crore from ONGC, Adani Enterprises shares rose after its airport arm agreed to raise $1 billion from BlackRock and Temasek at an $18 billion valuation, and ICICI Prudential AMC received RBI approval to acquire stakes of up to 9.95% in Kotak Mahindra Bank, AU Small Finance Bank, CSB Bank and DCB Bank. Separately, India lifted its trading ban on a JPMorgan unit tied to an alleged Sensex closing-auction manipulation case after a settlement deposit.
Regulatory and Structural Shifts
Sebi revised commodity derivatives position limits and penalty frameworks for open-interest violations, while also proposing eased eligibility norms for market infrastructure institution directors. The RBI, meanwhile, is exploring gold tokenisation under its Unified Markets Interface and plans to expand retail forex access with five new currency pairs, signalling continued incremental modernisation of India's market infrastructure even as near-term sentiment remains fragile.