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Informist, Wednesday, May 27, 2026

By Arundathi A R

MUMBAI – Headline stock indices are likely to extend their losses Wednesday to open slightly lower as West Asia war worries escalated post US strikes on southern Iran. After falling to a low of $95 a barrel Monday, crude oil prices rose again to nearly $100 a barrel, which adds to the potential negative sentiment in the market. However, Asian markets were mixed in early trade.

Iran's foreign ministry said US strikes in Iran's southern Hormozgan province represent a "gross violation" of the fragile ceasefire in place since early April, Al Jazeera reported. Seyed Majid Moosavi, the commander of the Revolutionary Guards' aerospace force, posted on his X account that the forces were prepared to respond and "negotiation with the enemy is pure loss."

Meanwhile, Israel attacked southern Lebanon on Tuesdsy, killing 31 people and injuring 40 others, as Israel's forces intensified their strikes and issued dozens of forced displacement orders for towns and villages in Lebanon's south and east, according to Al Jazeera. A senior spokesman for Iran's armed forces warned that a resumption of the US-Israel conflict on Iran would be met with a "much heavier and stronger" response and "will extend beyond regional borders," Al Jazeera said, quoting Fars news agency.

At 0726 IST, Brent crude oil July futures were 0.7% lower at $98.88 a barrel. The futures contract shed 4.5% in a week and lost nearly 12% in the last seven days. " It will take time for crude oil prices to fall to their pre-war levels as the supply chain disruptions, which are almost extended now to two months, will now take its own time to settle down," the research director at an asset management company said.

"Broader market rally is expected to continue," the research director said. "There are various themes which are insulated from certain macroeconomic shocks, he said. "However, the Nifty 50 index may be largely range-bound, because all these pressures will now come into Q1 (Apr-Jun) and Q2 (Jul-Sept) results, price hikes, and subsequent interest rate hikes by the Reserve Bank of India," he said.

Foreign institutional investors were net sellers Tuesday and offloaded shares worth INR 24.08 billion. Domestic investors, however, continued lending support to the domestic equity market and net bought shares of INR 13.61 billion. The research director said foreign investors were selling because market valuations were not very attractive. He also said large capital expenditure was going out as the artificial intelligence trend was largely followed globally, and India has limited beneficiaries to supply to that value chain.

"Gift Nifty is indicating a slightly gap-down opening for the domestic markets," Vipin Kumar, technical analyst at Globe Capital Market, said. "Immediate support for Nifty index is placed around 23800-23850 spot levels. Going ahead, we reiterate our bullish view on Nifty index as long as it remains above 23800 spot levels on closing basis. Conversely, sustained trading below 23800 spot levels might push it back in a consolidation phase," he said. At 0811 IST, the June futures contract of the GIFT Nifty was a tad lower from its previous close at 23891.50. This was over 22 points short of the Nifty 50's previous close of 23913.70.

An internal vigilance probe at HDFC Bank has found that INR 450 million paid to Maharashtra State Road Development Corp. as additional interest was allegedly disguised as marketing expenditure routed through local vendors, The Indian Express reported Wednesday, citing sources. As per the investigation, the bank's marketing department facilitated the arrangement by showing the payouts as spending on a road safety awareness campaign instead of directly crediting them as interest payments, the report said. On Tuesday, shares of HDFC Bank closed 1% lower at INR 778.90, and it settled lower after two sessions of gains.

Investment bank Jefferies expects the higher petroleum and fertiliser subsidies, along with lower oil tax revenue, to impact the government's finances. It sees the non-defence capital expenditure growth to be flat. Jefferies sees the overall impact to be INR 1.25 trillion-INR 1.5 trillion, which should be shared with states and oil companies. It expects this impact to be offset by lower expenditure, most likely in non-defence capital expenditure, which may make it flat on year in 2026-27 (Apr-Mar). 

Sjares of Oil and Natural Gas Corp. will be watched Wednesday, as the company reported its March quarter earnings Tuesday post market hours. The state-owned company's net profit in the March quarter rose over 3% on year to INR 66.50 billion. The bottom line was way below analysts' view of INR 87.02 billion. Its revenue from operations rose 3% on year to INR 359.28 billion, also lower than analysts' estimate of INR 362.99 billion.

Barring the Dow Jones Industrial Average, major US indices closed higher Tuesday. South Korea's KOSPI gained the most among Asian markets, and was nearly 5% higher.  End

US$1 = INR 95.68

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Avishek Dutta

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