Closing Bell: Sensex Falls 1,092 Points, Nifty 50 Slips Below 23,550: MSCI Outflows, Weak Heavyweights Drag Markets

Market Update at 04:12 PM: Indian equity markets ended sharply lower on Friday, May 29, as both Sensex and Nifty 50 came under pressure due to weakness in heavyweight stocks, MSCI index rebalancing outflows, and cautious global sentiment amid lingering Middle East geopolitical tensions.

The Nifty 50 opened on a flat note and moved in a narrow range during early trade. However, selling pressure intensified in the second half of the session, dragging the index more than 400 points from the day’s high. The late-session fall extended losses for the third consecutive trading session, with market participants attributing the weakness largely to MSCI index rebalancing-related flows.

At the close, the Nifty 50 settled below the 23,550 mark at 23,359.40, down 359.40 points or 1.5 per cent. The Sensex ended at 74,775.74, declining 1,092.05 points or 1.44 per cent. The Bank Nifty index also fell over 1 per cent, weighed down by weakness in HDFC Bank. The India VIX rose 8 per cent, moving above 16, signaling increased market volatility.

On a weekly basis, the Nifty 50 declined 0.72 per cent, while the Sensex fell 0.85 per cent. For the month of May, the Nifty 50 has dropped 2.78 per cent, reflecting sustained pressure across key sectors.

A key factor influencing trade was the MSCI Global Standard Index rebalancing, which is estimated to have triggered foreign passive outflows worth around USD 800 million to USD 1 billion from Indian equities. This led to sharp Intraday volatility, particularly in Large-Cap stocks with higher index weightage.

Global cues also remained mixed. The U.S. and Iran reportedly reached an understanding on Thursday to extend their ceasefire and ease restrictions on shipping through the Strait of Hormuz, according to Reuters sources. However, the agreement has not been officially finalized, with U.S. President Donald Trump yet to approve it and Iranian state media also not confirming the deal.

Following these developments, Brent crude oil slipped toward USD 90 per barrel and remained on track for a sharp monthly decline as easing geopolitical tensions reduced concerns over supply disruptions.

The Indian rupee strengthened and hovered near Rs 95 per U.S. dollar after the holiday break, supported by easing crude oil prices and reduced geopolitical risk, which helped improve currency sentiment.

On the sectoral front, only one of the 11 major indices ended in positive territory. Broader markets also remained weak, with the Nifty Midcap 100 index falling 1.33 per cent and the Nifty Smallcap 100 index declining 0.85 per cent. However, the Nifty Midcap 250 index touched a fresh all-time high during the session.

The Nifty IT index was the top gainer, rising 0.6 per cent, with 8 out of 10 constituents ending higher. Wipro gained 1.32 per cent after announcing a partnership with ServiceNow for agentic AI workflows, while TCS and HCLTech rose up to 1.5 per cent. On the other hand, the Nifty Metal index was the worst performer, falling 2.02 per cent and snapping a six-day winning streak.

Among individual stocks, Max Healthcare fell 2.85 per cent, extending its losing streak to nearly 10 per cent over five sessions after subdued quarterly earnings. Bharat Dynamics dropped 6.05 per cent, and Bata India declined 3.41 per cent following weak profit numbers. On the positive side, Supriya Lifesciences surged 20 per cent after strong March quarter results, while PC Jeweller rose 4.35 per cent on improved earnings.

Larsen & Toubro added 7.39 points to the Nifty 50, while HCL Technologies and Tech Mahindra contributed 4.25 points and 3.91 points respectively. On the downside, HDFC Bank dragged the index by 47 points, followed by Reliance Industries with a 43.08-point impact and ICICI Bank with a 25.42-point drag.

Market breadth remained weak, with 3,422 NSE-listed stocks trading during the session. Of these, 1,145 advanced, 2,171 declined, and 106 remained unchanged. Additionally, 155 stocks touched 52-week highs, while 59 hit 52-week lows. A total of 130 stocks were locked in Upper Circuits, while 131 hit Lower Circuits.

Market Update at 2:19 PM: Indian equity benchmark indices traded in a narrow range on Friday amid developments surrounding a possible peace agreement between the U.S. and Iran.

As of 2:08 PM on May 29, the Nifty 50 declined 160.00 points, or 0.67 per cent, to 23,747.15. The Sensex fell 429.46 points, or 0.57 per cent, to 75,438.34.

Among the Top Losers on the Nifty 50 index were Eicher Motors, InterGlobe Aviation, and Oil & Natural Gas Corporation.

Broader markets showed mixed performance during the session. The Nifty MidCap index was down 0.79 per cent, while the Nifty SmallCap index gained 0.13 per cent.

On the sectoral front, the Nifty Consumer Durable and Nifty Auto indices witnessed the sharpest decline. Meanwhile, the Nifty Realty index outperformed the broader market.

Investor sentiment remained cautious as reports indicated progress in diplomatic talks between the U.S. and Iran. According to a Bloomberg report citing sources, both countries have agreed to renew a 60-day truce while negotiations continue to reach a broader agreement aimed at ending the conflict. The proposed truce extension is currently awaiting approval from U.S. President Donald Trump.

However, geopolitical tensions continued to linger. Iran’s armed forces reportedly fired missiles at unspecified targets late Thursday. Earlier, the Pentagon stated that Tehran had launched ballistic missiles targeting Kuwait and deployed attack drones in and around the Strait of Hormuz.

Market Update at 12:13 PM: Indian equity benchmarks traded in a narrow range on Friday afternoon as investors closely tracked developments surrounding a possible peace agreement between the U.S. and Iran.

At around 12:00 PM, the Nifty 50 slipped 14.30 points, or 0.06 per cent, to 23,888.95. The Sensex, however, edged higher by 83.26 points, or 0.11 per cent, to 75,951.06.

Broader markets showed a mixed trend during the session. The Nifty MidCap index declined 0.13 per cent, while the Nifty SmallCap index gained 0.63 per cent, indicating selective buying interest in smaller stocks.

Among sectoral indices, the Nifty IT index emerged as the top performer, rising nearly 3 per cent. Gains were also seen in the Nifty PSU Bank and Nifty Pharma indices. On the other hand, the Nifty Metal, Nifty FMCG, and Nifty Chemical indices remained under pressure and underperformed the broader market.

Investor sentiment remained cautious amid reports that the U.S. and Iran have agreed to renew a 60-day truce as negotiations continue to reach a broader agreement aimed at ending the ongoing conflict. According to reports citing sources, the proposed truce extension is awaiting approval from U.S. President Donald Trump.

Market Update at 09:35 AM: The Indian stock market opened higher on Friday amid signs of a possible peace deal between the US and Iran. Investor sentiment improved after reports suggested that both countries agreed to renew a 60-day truce while continuing talks to end the war.

As of 9:17 AM, the Nifty50 gained 36.90 points, or 0.15%, to 23,957.75, while the Sensex rose 219.95 points, or 0.29%, to 76,087.75.

In the broader markets, the Nifty MidCap index traded 0.19% higher, while the Nifty SmallCap index advanced 0.37%.

Among sectors, the Nifty IT index surged nearly 3% to emerge as the top gainer. The Nifty PSU Bank and the Nifty Pharma indices also outperformed. However, the Nifty Metal, the Nifty FMCG, and the Nifty Chemical indices lagged the broader market.

According to a report, the US and Iran have agreed to renew a 60-day truce as both sides work toward a broader agreement to end the conflict. The report added that the truce deal is awaiting approval from US President Donald Trump.

Pre-Market Update at 7:45 AM: Indian stock market benchmark indices Sensex and Nifty 50 are expected to open on a cautious note on Friday, May 29, as investors closely monitor developments surrounding the U.S.-Iran peace negotiations and global macroeconomic signals.

Gift Nifty was trading near the 23,889 mark, a premium of around 16 points over the previous close of Nifty futures, indicating a muted start for domestic equities. Asian markets traded higher, while Wall Street ended in positive territory overnight, with the S&P 500 and Nasdaq Composite hitting record closing highs.

Investor sentiment remained guarded after reports suggested that the U.S. and Iran are working on a draft agreement to extend the ceasefire by 60 days. However, U.S. Vice President JD Vance reportedly said the two countries were “close” to finalising a deal, but discussions were still ongoing.

U.S. inflation accelerated at its fastest pace in three years in April, largely due to elevated energy prices. The Personal Consumption Expenditures (PCE) Price Index rose 3.8 per cent year-on-year in April, compared to 3.5 per cent in March. On a monthly basis, inflation increased 0.4 per cent after a 0.7 per cent rise in the previous month.

According to media reports, negotiators from the U.S. and Iran moved closer to an agreement aimed at extending the fragile ceasefire by 60 days. The proposed deal reportedly includes unrestricted shipping through the Strait of Hormuz, removal of Iranian naval mines within 30 days, and lifting of the U.S. naval blockade after commercial traffic normalises.

Fresh unemployment benefit claims in the U.S. increased slightly last week. Initial jobless claims rose by 5,000 to 215,000 for the week ended May 23, above market estimates of 211,000. Claims have largely remained in the 190,000 to 230,000 range so far this year.

Crude oil prices declined amid optimism over a possible extension of the U.S.-Iran ceasefire. Brent crude futures for August delivery fell 0.50 per cent to USD 92.24 per barrel, while U.S. WTI crude dropped 0.71 per cent to USD 88.27 per barrel. Oil prices have fallen more than 8 per cent this week.

Gold prices edged higher as investors assessed geopolitical developments. Spot gold rose 0.4 per cent to USD 4,512.79 per ounce, while spot silver gained 0.7 per cent to USD 76.17 per ounce.

The U.S. dollar remained weak against major global currencies. The dollar index was largely unchanged at 98.997 but was on track for a weekly decline of 0.3 per cent. The euro traded at USD 1.1653, while the Japanese yen strengthened to 159.27 per dollar.

Derivatives data for the June series expiry indicated that the Put-Call Ratio (PCR) stood at 0.85. On the Put side, significant open interest concentration was seen at the 23,900 strike, suggesting strong support at those levels. On the Call side, the highest open interest addition was recorded at the 24,000 strike, indicating immediate resistance for the index.

Technically, Nifty 50 continues to hold above its crucial short-term support zone of 23,800 to 23,865, which includes the 20-day moving average, recent breakout area and May 25 gap zone. A sustained move below this range could weaken the near-term structure and drag the index towards 23,684, where the 50-day moving average is placed, followed by the next major support near 23,400.

On the upside, the 24,000 level remains a crucial hurdle. A decisive close above this mark may improve market sentiment and open the path towards 24,126 and 24,200 levels.

Companies scheduled to announce quarterly earnings on May 30 include Ahluwalia Contracts (India), Linde India, PTC Industries, Som Distilleries & Breweries, Suraj Estate Developers, Suraj Industries, Titagarh Rail Systems, TTK Healthcare, Uflex and Veranda Learning Solutions.

No stock has been placed under the futures and options (F&O) ban for May 29.

Foreign Institutional Investors (FIIs) remained net sellers on May 29, selling equities worth Rs 1,042.70 crore. Domestic Institutional Investors (DIIs), however, purchased shares worth Rs 3,821 crore.

Indian benchmark indices ended marginally lower on Wednesday, marking their second consecutive session of losses due to weakness in heavyweight banking stocks including HDFC Bank and ICICI Bank. The Sensex declined 142 points, or 0.19 per cent, to close at 75,867.80, while the Nifty 50 slipped 7 points, or 0.03 per cent, to settle at 23,907.15.

U.S. stock markets ended higher on Thursday after reports of progress in the U.S.-Iran peace negotiations boosted investor confidence. The Dow Jones Industrial Average rose 24.69 points, or 0.05 per cent, to close at 50,668.97. The S&P 500 gained 0.58 per cent to end at 7,563.63, while the Nasdaq Composite surged 0.91 per cent to settle at 26,917.47.

Among major technology stocks, Nvidia rose 0.78 per cent, AMD rallied 4.55 per cent, Microsoft gained 3.47 per cent, Apple added 0.53 per cent and Marvell Technology climbed 3.09 per cent. Tesla shares also ended 0.40 per cent higher.

Disclaimer: The article is for informational purposes only and not investment advice.

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