Markets ended lower after two consecutive weeks of gains, weighed down by heightened geopolitical tensions and weak earnings commentary from IT majors. Following an initial uptick, benchmark indices remained under pressure for most of the week amid persistent selling. Consequently, the Nifty 50 declined 1.87% to close at 23,897.95, while the Sensex fell 2.33% to settle at 76,664.21.
Key Market Drivers
Global developments continued to dominate market direction, with ongoing uncertainty around the West Asia crisis and concerns over supply disruptions keeping crude oil prices elevated. Brent crude surged nearly 8–10% during the week, crossing the $105 per barrel mark, thereby intensifying concerns around inflation, a widening import bill, and potential pressure on India’s fiscal balance.
Additionally, disappointing earnings and subdued outlook from IT majors, coupled with sustained foreign institutional investor (FII) outflows, further dampened sentiment.
On the domestic front, macroeconomic indicators were mixed. The Index of Eight Core Industries contracted by 0.4% YoY in March 2026, indicating weakness across key segments such as fertilisers, crude oil, coal, and electricity. Moody’s also revised India’s FY27 GDP growth forecast downward to 6%, citing weak consumption, slower industrial activity, and rising energy costs.
However, high-frequency indicators provided some support. The HSBC Flash Composite PMI rose to 58.3 in April, reflecting robust expansion in overall business activity. Services PMI stood at 57.9, while Manufacturing PMI improved to 55.9, indicating strengthening business conditions.
Sectoral Snapshot
Sectoral performance was largely negative, reflecting broad-based risk aversion. The IT sector was the biggest laggard, declining over 10% due to weak earnings and cautious guidance. Auto, financials, and realty sectors also ended in the red amid macro concerns.
On the positive side, energy and FMCG sectors provided some support and continue to attract selective buying interest.
Broader markets displayed relative resilience, with midcap and smallcap indices witnessing only marginal declines, indicating selective participation despite overall market weakness.
Key Events to Watch
The upcoming week will remain crucial, with geopolitical developments in West Asia and their impact on crude oil prices continuing to drive sentiment.
Domestically, the Q4 FY26 earnings season will gather momentum, with key companies across banking, financials, cement, metals, and consumption sectors scheduled to report results. Management commentary on input cost pressures, demand outlook, and margin sustainability will be closely monitored.
On the macro front, Industrial Production data for March will be released on April 28, while foreign exchange reserves data is due on May 1. Globally, the US Federal Reserve’s policy decision will be a key event, providing cues on interest rate trajectory and liquidity conditions.
Technical Outlook
Nifty: The index has slipped below its crucial support at 23,900 (20 DEMA), indicating a shift in near-term bias towards the negative side. Immediate support is placed around 23,500. On the upside, the 24,200–24,500 zone is likely to act as a strong resistance band. Any rebound towards these levels may face selling pressure unless supported by easing crude prices and improved global cues.
Bank Nifty: The banking index continues to hover around key moving averages but remains relatively stronger than the benchmark. Immediate support is seen near 55,600 (20 DEMA), followed by a major support at 54,300. A breach below these levels could weaken the current structure. On the upside, 57,700 remains a key hurdle, with a decisive breakout potentially driving the index towards 59,000.
Market Breadth: Broader market participation remained relatively stable despite the correction in benchmark indices. The limited decline in midcap and smallcap indices suggests selective buying interest; however, overall sentiment remains cautious amid elevated volatility and global uncertainties.
Strategy Ahead
Given the prevailing macro uncertainty, elevated crude prices, and persistent global risks, investors should maintain a cautious and selective approach.
Traders are advised to remain disciplined, avoid aggressive leverage, and prioritise capital preservation. With volatility expected to stay elevated amid geopolitical developments and the ongoing earnings season, a hedged and stock-specific strategy will be essential until clearer directional cues emerge.
We reiterate our preference for stocks in the energy and metals space, while selectively considering opportunities in FMCG and pharma. Conversely, the sharp correction in IT has disrupted its recovery trend, and the sector may remain under pressure in the near term; hence, fresh short-term buying should be avoided.