On Monday, September 28, Indian equities slid toward six-month lows, extending a seven-week losing streak as climbing oil prices compounded market pressures. The Nifty 50 slipped past the 23,000 threshold, accompanied by widespread declines across all key sectors. Furthermore, investors grappled with persistent foreign capital outflows as the month drew to a close.
Nifty and Sensex Fall as Oil Tops USD 106
By 10 a.m. IST, the Nifty 50 had dropped 1.16% to 22,871.40, while the BSE Sensex retreated 1.18% to 73,022.60. Reuters data indicates that both benchmarks had already surrendered nearly 6% over the preceding seven weeks. Monday’s losses deepened this downward trend as Brent crude futures advanced 2.3% to approximately USD 106.70 per barrel.
Crude prices climbed following remarks from US President Donald Trump, who stated he had turned down an Iranian offer to reopen the Strait of Hormuz and halt hostilities. Although Iran maintained on Sunday that diplomacy remains the sole path to settling its disputes with the United States and Israel, the absence of a pact kept market focus squarely on petroleum transit through the vital waterway.
As the globe’s third-largest importer of crude, India faces increased import expenditures and higher operational expenses for companies when petroleum costs rise. G Chokkalingam, founder of Equinomics Research, highlighted petroleum costs, inflation, and constrained liquidity as major worries for local markets, characterizing the near-term outlook as ‘quite pessimistic’ subject to how these economic stresses evolve.
Selling Spreads Across Sectors and Large Stocks
Early trading saw all 16 principal Indian stock sectors decline. Both the broader mid-cap and small-cap indexes retreated roughly 1.1% each. Financial and banking equities, which hold heavy weightings within the benchmark indices, each shed about 1.6%. Notable losers included HDFC Bank down 1.8%, ICICI Bank lower by 1.7%, and Reliance Industries off 1.4%.
This September slump followed a reversal in overseas investment patterns. Figures from the National Securities Depository Limited, referenced by Upstox, show that foreign institutional investors offloaded shares totaling Rs. 17,131 crore during the month, contrasting with net purchases of Rs. 49,831 crore across July and August. Over the timeframe addressed by the report, the Nifty dropped roughly 5.3% in September, whereas the Sensex declined by 5.36%.
The broader Asian region also felt the strain of higher petroleum values. During Monday’s session, mainland Chinese indexes and South Korea’s Kospi dropped, though Hong Kong managed gains. Additionally, domestic traders were preparing for Tuesday’s month-end expiry of Bank Nifty and Nifty derivatives contracts.
NSE Shares Slip Below Their IPO Price
Shares of the National Stock Exchange of India slid 1.8% to Rs. 1,761 on Monday, marking their third session of trade. This movement pushed the stock beneath its initial public offering price of Rs. 1,785, following a 1.9% gain during its debut the previous week.
The share sale generated Rs. 22,560 crore via divestments from current shareholders. Its market entry coincided with the broader market downturn, while market observers also cited anxieties regarding trading turnover and the company’s valuation. Conversely, NSE executives noted that the exchange is winning back market share in equity options as participants adapt to stricter regulations.
Individual equities fluctuated on company-specific developments. Omaxe dropped 3.3% after the nation’s market watchdog prohibited the firm from the securities market for a three-month duration regarding minimum public shareholding regulations. Meanwhile, Allied Blenders & Distillers added 2% after a financial firm initiated coverage with a buy recommendation, and Borosil climbed 3% following an upward revision of its price target by another brokerage.
Also Read: Sensex, Nifty Under Pressure: Why Rising Oil Prices are a Bigger Threat to India
