Equity benchmarks ended the week with their eighth consecutive weekly decline, marking the longest losing streak in nearly 25 years. The Sensex fell 570.59 points to close at 71,909.70 on Thursday. Persistent foreign fund outflows, high US bond yields, and crude oil prices near $100 a barrel hurt investor sentiment.
Equity benchmarks ended the week with their eighth consecutive weekly decline, marking the longest such losing streak in nearly 25 years, as persistent foreign fund outflows, elevated US bond yields and crude oil prices near $100 a barrel weighed on investor sentiment.
The latest streak has surpassed the seven-week decline recorded during the Covid-led market correction, with geopolitical tensions in West Asia and sustained weakness in the rupee adding to concerns over India’s macroeconomic outlook.
The shortened trading week ended on Thursday, with the Sensex declining 570.59 points, or 0.79 per cent, to close at 71,909.70, while the Nifty 50 fell 198.50 points, or 0.88 per cent, to settle at 22,421.95.
The benchmarks witnessed selling pressure throughout the week, with the Nifty losing 3.10 per cent and the Sensex shedding nearly 2,000 points. Both indices recovered from steeper intraday losses on Thursday following selective buying towards the close. The Sensex touched an intraday low of 71,292.88, while the Nifty fell to 22,217.
Foreign institutional investor (FII) outflows remained a significant overhang, with market participants attributing the selling to the relative attractiveness of dollar assets amid rising US Treasury yields.
The US 10-year bond yield hovered around 5.3-5.34 per cent, while the rupee weakened to around ₹96.23 against the dollar.
Brent crude traded near or above $100 a barrel, raising concerns over India’s import bill, imported inflation and corporate input costs. With India importing nearly 90 per cent of its crude oil requirements, sustained currency weakness could further increase the domestic cost of oil imports.
Selling was broad-based across sectors, with the BSE Consumer index declining 6.15 per cent and the Auto index falling 5.85 per cent during the week. Metals, FMCG, realty and power stocks also witnessed pressure.
IT emerged as the notable pocket of resilience, gaining 1.8 per cent on Thursday, supported by buying in large-cap technology stocks ahead of the September-quarter earnings season.
Among Nifty constituents, Infosys gained 4.1 per cent in Thursday’s session, while Bajaj Auto fell 7.6 per cent and Maruti Suzuki declined 4.9 per cent. Broader markets also remained weak, with the Nifty Midcap 100 declining 1.01 per cent and the Nifty Smallcap 100 losing 0.97 per cent on Thursday.e defensive.
The external environment remained a key source of uncertainty. The US 10-year Treasury yield hovered around 5.3-5.34 per cent, reducing the relative attractiveness of emerging-market equities.
Brent crude traded around or above $100 a barrel, while the rupee weakened to approximately ₹96.23 against the dollar. Higher oil prices and currency depreciation could increase India’s import bill and imported inflation, while raising input costs for oil-sensitive industries.
“The combination of elevated US Treasury yields and Brent crude prices above $100 remains a key risk for investor sentiment,” said Sunny Agrawal, Deputy Vice-President, Fundamental Research, SBI Securities. He noted that the benchmarks had recovered from steeper intraday losses on Thursday on selective buying.
Vishnu Kant Upadhyay, AVP – Research & Advisory at Master Capital Services, said a moderation in US borrowing costs, stabilisation in the rupee and lower crude prices could help improve foreign investor flows. He added that stronger September-quarter earnings and sustained earnings growth would also be important for sentiment.
Meanwhile, Kruti Shah, Quant Analyst at Equirus Securities, said the Nifty could remain within the 22,000-22,800 range in the near term. She flagged the record IPO pipeline and pressure on margin trading funding (MTF) books as additional constraints on secondary-market liquidity, while noting that short positioning could leave room for a recovery if global sentiment stabilises.
Looking ahead, the market will remain focused on the RBI’s October 5-7 monetary policy meeting, developments in West Asia, movements in crude oil prices and US bond yields, and the September-quarter earnings season.
Amol Athawale, VP – Technical Research at Kotak Securities, identified 22,200 as a key support for the Nifty and 22,500 as an immediate resistance, with the market’s ability to sustain a recovery likely to depend on buying participation and easing global uncertainties.