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Informist, Friday, May 22, 2026

 

By Arundathi A R

 

MUMBAI – Analysts still see developments relating to the US-Iran war and crude oil prices determining the market's direction in the coming week. Market participants will keenly watch for the next development in the ongoing US-Iran peace negotiations with the Iranian government reviewing the latest US proposal for a deal to end the war. The March quarter corporate results will continue to be in focus.

 

"Volatility is expected to remain high with key focus on developments around US–Iran tensions, oil-price trajectories, and quarterly corporate earnings," Bajaj Broking Research said in a market commentary note. Analysts see the Nifty 50 facing resistance at 24000–24100 levels and finding support at 23500–23220 levels. Friday, the Nifty 50 settled at 23719.30, up over 64 points or 0.3%.

 

"Negatives of the war will be actually building up in Q1 (Apr-Jun) of 2026-27 (Apr-Mar)," Geetanjali Kedia, senior research analyst at SP Tulsian Investment Advisory Services, said. Kedia sees the negative implications of the West Asia war reflecting in profit margins of companies in upcoming quarters.

 

Brokerage ICICI Securities maintained its positive stance on the banking sector after the March quarter saw the sequential growth of private-sector banks converging with that of government-owned banks. "We acknowledge that macro uncertainties (crude and currency) could imperil systemic growth/NIMs (net interest margins)--stagflation is a worst-case risk," the brokerage said in its report. However, it sees systemic credit growth, even adjusted for wholesale uptick, being healthy. The net interest income growth for the financial year 2026–27 (Apr-Mar) could outpace loan growth, ICICI Securities said. The valuations of most banking stocks are near or below their long-term mean.

 

Friday, the Reserve Bank of India finalised the transfer of a record INR 2.87-trillion surplus to the government for FY26. The surplus transfer was on the lower end of market expectations, though it will help the government's revenues, which have been stretched by the war in West Asia.

 

MUFG Bank expects the RBI to raise interest rates by at least 50 basis points in the current financial year, possibly at the June and August policy meetings, as the rupee depreciates and capital inflow remains subdued. It estimated the Indian currency to fall to 98–100 per dollar if the war in West Asia continues, and expects the central bank to mount an interest-rate defence for the domestic currency. 

 

Banking stocks gained the most in the Nifty 50 index Friday. Among sectoral indices also, the Nifty Private Bank, Nifty Financial Services, and Nifty Bank were the top gainers, up over 1?ch.

 

Crisil Ratings expects the double-digit growth momentum of capital goods companies to continue, it said in a press release Friday. It sees revenue growth of 12–14% for these companies in FY27, driven by sustained government spending, steady expansion in power, mining, oil and gas, metal, and automotive-linked sectors, and increasing opportunities from emerging segments.

 

"The operating margin is expected to remain range-bound at 12–13% this fiscal year, supported by strong execution, long-term client relationships, and improved operating leverage despite geopolitical cost pressure," according to the release. With the support of healthy revenue growth and strong balance sheets, the sector's overall credit outlook is seen as stable, said Joanne Gonsalves, associate director at Crisil Ratings, in the release.

 

Foreign institutional investors continued to sell Thursday, while domestic investors supported the equity market. The foreign fund outflow from the market was INR 18.91 billion in the last session of the week, while domestic investors net bought shares worth INR 24.94 billion. Foreign investors net sold shares worth INR 242.29 billion in the week.

 

According to media reports, US Ambassador to India Sergio Gor Thursday expressed confidence that the much-awaited bilateral trade agreement with India may be finalised in the "coming weeks and months". The "shared ambition" of achieving bilateral trade worth $500 billion by 2030 reflects "the connectivity between our economies", Gor said at the Annual Leadership Summit of the American Chamber of Commerce.

 

After market hours, Eicher Motors reported a consolidated net profit of INR 15.20 billion, up nearly 12% on year, for the March quarter. Its top line stood at INR 60.80 billion, up 16% on year. Both metrics beat the Street's view.

 

Shares of NTPC are in the spotlight as the company will detail its March quarter earnings Saturday. It is likely to report a net profit of nearly INR 59 billion for the quarter, up nearly 2% on year. Its top line is seen at over INR 470 billion, up over 7% on year.  End

 

US$1 = INR 95.69

 

Edited by Rajeev Pai

 

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