Opening Bell: Nifty 50, Sensex Fall Over 0.7%; Oil Prices, Weak Global Markets Weigh on Sentiment; IPO Activity in Focus

Market Update at 09:30 AM: The Nifty 50 and the Sensex were trading flat with a negative bias as rising oil prices and weakness across most global equity markets weighed on investor sentiment.

As of 9:18 AM, the Sensex fell 531.03 points, or 0.72 per cent, to 73,364.71, while the Nifty 50 declined 174.15 points, or 0.75 per cent, to 22,966.35.

Hindalco Industries, Max Healthcare Institute, and Kotak Mahindra Bank were the Top Losers on the Nifty 50 index.

In the broader market, the Nifty MidCap index declined 0.62 per cent, while the Nifty SmallCap index fell 0.61 per cent.

Among sectors, the Nifty Private Bank index declined the most, while the Nifty IT index outperformed on a relative basis, recording the smallest decline.

On the IPO front, SRIT India and Shah Investor's Home IPOs will open for subscription on Monday. In the SME segment, Acme Universal Safezone 9, Shivchem Agro, and Pind Hospitality IPOs are also opening for subscription.

The IPOs of Snapdeal, Orient Cables, German Green Steel, and Runwal Enterprises are entering their second day of subscription. Additionally, the IPOs of Bench Mark, Shree TNB Polymers, Dudani Retail, Himalayan Solar, and Sai Urja Indo are also entering their second day of subscription.

Meanwhile, the IPOs of Moneyview, A-One Steels, Green Asia Impex, Peshwa Wheat, and Roopa Screen are entering their final day of subscription.

Pre-Market Update at 7:40 AM: GIFT Nifty was quoted at 23,237.50, up 49 points from the previous Nifty 50 close of 23,140.50. This indicates a mildly positive opening for Indian equities on Monday, although the premium remains modest compared with the volatility witnessed during the previous week.

The Nifty 50 gained 77.40 points or 0.34 per cent on Friday but still ended the week lower for a seventh consecutive week. The Friday recovery, therefore, comes against a broader weak trend rather than confirming a change in direction.

Wall Street ended Friday on a stronger footing. The S&P 500 rose 0.51 per cent to 7,743.41, the Nasdaq gained 0.48 per cent to 27,068.72, while the Dow Jones advanced 0.93 per cent to 51,828.62. Technology stocks led the recovery, with Microsoft gaining 3.7 per cent, while Qualcomm and Dell also advanced. Akamai Technologies gained after announcing an USD 11.6 billion cloud services deal with Anthropic.

U.S. markets were also supported by easing oil prices and reports that U.S. and Iranian negotiators were exploring a possible path towards reopening the Strait of Hormuz. However, Treasury yields remained elevated. The U.S. 10-year yield reached a fresh 19-year high and was last at 5.196 per cent. Markets were also pricing a 66 per cent probability of another 25-basis-point Federal Reserve rate hike in October.

Asian markets are closed for the weekend at the time of this report. In the latest available session, the Nikkei 225 stood at 66,364.20, up 1.30 per cent, while the Hang Seng closed at 24,510.09, down 1.01 per cent. The Shanghai Composite was last available at 3,888.37, while the Kospi stood at 7,080.92.

European markets ended the latest session mixed to lower. The FTSE 100 declined 0.24 per cent to 10,679.99, the DAX fell 0.57 per cent to 25,266.53 and the CAC 40 declined 0.52 per cent to 8,081.43.

The weekend geopolitical developments could remain important for global markets. Shipping through the Strait of Hormuz slowed sharply over the weekend following tanker attacks, while U.S.-Iran talks stalled. Separately, Iran's military said it was prepared for possible renewed U.S. attacks after the U.S. rejected an Iranian proposal linked to reopening the strait.

Brent crude futures settled at USD 104.32 per barrel, down 2.14 per cent on September 25, while WTI crude ended at USD 92.57, lower by 2.16 per cent. The decline offers some relief to oil marketing companies, airlines and crude-intensive sectors such as paints. However, developments around the Strait of Hormuz remain a significant supply-risk variable for the next trading session.

Gold futures ended at USD 4,320.50 per ounce, up 0.52 per cent, while silver futures closed around USD 64.71, up 1.11 per cent.

The Dollar Index closed around 100.97, down 0.32 per cent on Friday, but remained higher over the week as hawkish Federal Reserve expectations and elevated Treasury yields supported the dollar.

The Indian rupee closed around Rs 95.81 per U.S. dollar on Friday, compared with Rs 95.96 previously. The currency remained close to the Rs 96 level despite RBI intervention and softer oil prices.

The U.S. 10-year Treasury yield ended Friday at 5.17 per cent after touching 5.22 per cent during the week. Elevated U.S. yields remain a negative factor for emerging-market equities as they increase the relative attraction of dollar assets and can contribute to foreign portfolio outflows.

Foreign Institutional Investors remained net sellers of Rs 3,693.90 crore in the cash market on September 25, while Domestic Institutional Investors bought Rs 2,838.20 crore. The latest monthly data also points to continued foreign selling pressure despite support from domestic institutions.

The Nifty 50 closed at 23,140.50 on Friday after moving between an Intraday low of 23,020.95 and a high of 23,162.70. The Sensex ended at 73,895.74, with an intraday high of 73,968.05 and low of 73,477.77.

For the Nifty 50, 23,000 remains the immediate support level. A decisive break below this zone could expose 22,700 and then 22,500. On the upside, 23,200 to 23,300 remains the first resistance zone. For Bank Nifty, support is placed around 55,000 to 54,900, while 55,900 to 56,000 remains the immediate recovery hurdle.

India VIX closed at 12.16, down 4.16 per cent on Friday after rising sharply earlier in the week. The decline indicates some cooling in near-term volatility, although the weekly increase and ongoing geopolitical risks continue to keep the volatility backdrop important for investors.

Monday's domestic economic calendar includes August industrial production and manufacturing production data, scheduled for release at 10:30 AM. The calendar lists industrial production growth at 6.7 per cent previously and manufacturing production growth at 7.3 per cent.

Proposed IRDAI insurance distribution reforms, including changes to commission structures and expense limits, remain a key sector-specific trigger. The proposed changes could affect insurance distributors and commission-dependent businesses, while the regulator expects the reforms to improve transparency and digital adoption.

Bima Sugam is another development in focus, with IRDAI expecting the digital insurance marketplace to launch by November. The platform is intended to improve transparency and digitise insurance distribution, potentially supporting wider digital insurance adoption.

Developments on the U.S.-China front could also influence market sentiment. The two countries agreed to reduce tariffs on about USD 30 billion of non-sensitive goods and establish an AI incident communication channel. The measures reduce some trade friction, although several strategic differences remain.

RBI staff said India's economy remains resilient despite higher energy prices and geopolitical risks, with Q1 FY27 growth at 7.8 per cent. The assessment provides a supportive domestic macroeconomic backdrop, although higher energy costs remain a risk.

The government has retained H2 FY27 gross market borrowing at Rs 7.86 lakh crore. The borrowing programme remains relevant for domestic bond yields and interest-rate-sensitive sectors.

The Strait of Hormuz remains a key risk for the coming session. Shipping activity through the strait slowed sharply over the weekend following tanker attacks. If the disruption persists, it could create upside pressure on crude prices and weigh on oil-importing sectors.

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

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