The Indian stock market struggled to find a clear direction on Thursday as investors weighed soaring crude oil prices, geopolitical tensions and fresh global inflation concerns. The Sensex swung between gains and losses in early trade, while the Nifty 50 slipped below the 23,450 level, extending the cautious mood after Wednesday’s sharp sell-off.
The market opened on a mildly positive note, with the Sensex gaining 61.86 points to 74,826.09 and the Nifty rising 14.80 points to 23,446.30. However, the early gains quickly faded. By around 9:36 am, the Sensex was almost flat at 74,759.54, while the Nifty stood at 23,429.25.
The weakness followed a difficult session on Wednesday, when the Sensex plunged 813.35 points to 74,764.23 and the Nifty fell 203.60 points to 23,431.50. Both benchmarks have now declined in seven of the past eight sessions, losing around 3.1% during that period.
The biggest worry for investors continues to be the sharp rise in crude oil prices. Brent crude moved above the $100-a-barrel mark, with prices around $101-$102, as the escalating US-Iran conflict raised fears of further disruptions to global oil supplies.
The situation around the Strait of Hormuz has added to those concerns. Any prolonged disruption in the region could keep energy prices elevated and increase pressure on countries such as India, which relies heavily on crude imports.
Higher oil prices are a concern for the Indian economy because they can increase the import bill, weaken the rupee and add to inflationary pressure. They can also raise operating costs for companies and squeeze profit margins if businesses are unable to pass on the higher costs to consumers.
The rupee also remained under pressure, trading around the ₹95.30-per-dollar level. The combination of expensive crude and a weaker currency has made investors more cautious about the near-term outlook for Indian equities.
Despite the broader caution, buying was visible in selected stocks. On the Sensex, Axis Bank, Bajaj Finserv and Larsen & Toubro were among the early gainers. Tech Mahindra and State Bank of India also traded higher.
On the other side, Mahindra & Mahindra emerged as the biggest laggard in the early session, while BEL, Tata Steel and UltraTech Cement also faced selling pressure.
In the broader market, Shakti Pumps attracted strong buying after securing an order worth around ₹236 crore from Maharashtra State Electricity Distribution Company for supplying 10,000 solar-powered water pumps. Its shares jumped more than 10% during Thursday’s trade.
Enviro Infra Engineers was another notable gainer, rising after receiving a letter of intent from Tata Power Renewable Energy for the development of a 180 MW wind power project in Maharashtra. The stock gained around 4.4% in early trade.
Oil producers also benefited from the rise in crude prices. ONGC and Oil India gained as higher oil prices are expected to support revenues and margins for upstream producers.
IT stocks continued to remain under pressure after the Nifty IT index suffered a sharp 3.2% fall in the previous session, its steepest single-day decline in three months.
The sector has been facing pressure from concerns over the outlook for technology spending, global economic conditions and the direction of US interest rates. Since Indian IT companies earn a large portion of their revenue from overseas markets, particularly the US, changes in global growth and interest-rate expectations can quickly affect investor sentiment towards the sector.
The weakness in IT added to the pressure on the broader market, even as some banking, energy and infrastructure stocks managed to attract buyers.
The Indian market is also taking cues from weakness across global equities. Asian markets were largely lower on Thursday, while US stocks had ended lower for a third consecutive session.
Investors are now looking ahead to key US inflation data. The figures could influence expectations around the Federal Reserve’s interest-rate decision next week. A higher-than-expected inflation reading could make investors rethink expectations of easier monetary policy and potentially keep global bond yields elevated.
For Indian equities, this comes at a difficult time as the market is already dealing with higher crude prices, a weaker rupee and sustained foreign investor selling pressure.
The Nifty is now being closely watched around the 23,400 level after falling below 23,450. A sustained recovery above the recent resistance zones could provide some relief, while continued weakness in crude oil and global markets could keep selling pressure alive.
The immediate outlook for the Indian stock market will largely depend on how crude oil prices behave and whether geopolitical tensions show signs of easing. A prolonged rise in oil prices could put additional pressure on inflation, the rupee and corporate earnings, particularly for sectors that are heavily dependent on fuel and imports.
Investors will also track upcoming US inflation data for clues about the Federal Reserve’s next interest-rate decision. For the domestic market, the Nifty’s ability to hold key support levels will be crucial after its recent decline.
With several external risks still in play, traders are likely to remain selective. Thursday’s early swings underline the fragile mood in the market, where any fresh development on oil, geopolitics or global interest rates could quickly change the direction of the Sensex and Nifty.