India Stock Market Sensitive to Global Factors Amid US-Iran Tensions

The Indian stock market will remain sensitive to various global and domestic factors in the coming week. The US-Iran conflict, crude oil prices, US tariff moves, and global bond yields are expected to drive market sentiment. Market participants will closely track any signs of progress in US-Iran negotiations, changes in energy prices, and their potential impact on inflation and economic growth.

US tariff developments will also remain a focus area. The US House of Representatives has approved a Russia sanctions bill that would empower President Donald Trump to impose tariffs of up to 100 per cent on countries purchasing Russian oil and gas. This move could have implications for major importers such as India and China and may affect global trade and energy flows.

Crude oil prices are likely to remain another major market driver. The Indian stock market ended the truncated trading week on a weak note, weighed down by elevated crude oil prices and rising global bond yields. Concerns over the near-term inflationary impact of higher energy costs, along with their potential drag on economic growth, continued to weigh on investor sentiment.

Foreign institutional flows will also be closely watched. FIIs and FPIs turned net buyers in the cash market on September 18, purchasing shares worth Rs 599.54 crore more than they sold. Domestic institutional investors also remained net buyers, with net purchases of Rs 1,019.69 crore.

The rupee-dollar movement could add another layer of volatility for equities. The Indian stock market ended the week with a decline of 0.65 per cent in the Sensex and 0.22 per cent in the Nifty.