Indian stock market: The Indian stock market closed the week on a subdued note, extended its losing streak for a fifth straight week, as rising volatility driven by shifting global cues and escalating geopolitical tensions in the Middle East.
On Friday, March 27, both the benchmark indices — Sensex and Nifty 50 — dropped over 2% each. The Sensex plunged 1,690 points, or 2.25%, to close at 73,583, while the fell 487 points, or 2.09%, to settle at 22,819.60. Broader markets also remained under pressure, with the BSE 150 Midcap index declining 2.18% and the BSE 250 Smallcap index slipping 1.82%.
“Indian equity markets remained volatile and under pressure throughout the week, with sentiment continuing to stay fragile amid persistent geopolitical tensions, elevated crude oil prices, and sustained foreign outflows. Although the market attempted intermittent recoveries during the week, the broader structure remained weak, with indices failing to sustain gains at higher levels,” said Ponmudi R, CEO – Enrich Money.
Stock Market Outlook next week
According to Ponmudi, are likely to remain volatile and driven by developments on the geopolitical front, as investors will be closely watching the situation in the Middle East, where any escalation or signs of easing could quickly shift sentiment, particularly through their impact on crude oil prices.
“Elevated oil prices are expected to keep pressure on markets, while any pullback could prompt short-covering and support a rebound. Foreign investor flows, moves in the rupee, and broader global market trends are also likely to play a key role in shaping the near-term outlook,” he added.
Top 5 triggers for the Indian stock market
1] US-Iran ceasefire talks
There are still a few indications that Iran and the US will enter peace talks anytime soon, despite Donald Trump pushing for negotiations this week. He has extended the deadline to April 6 for Tehran to agree to reopen the crucial Strait of Hormuz or face the destruction of its power infrastructure.
Iran has turned down a 15-point proposal from Trump that offered sanctions relief in exchange for dismantling its nuclear facilities, scaling back its missile programme, and reopening the Strait of Hormuz. The strategic waterway — which typically handles about a fifth of global oil and liquefied natural gas flows — has been largely shut since the US and Israel launched strikes on Iran on February 28.
2] Crude oil prices
Oil prices have continued to climb in recent days as traders’ hopes for a near-term ceasefire have waned. settled above $112 per barrel on Friday, extending the international benchmark’s rally to more than 55% since the onset of the conflict.
According to market experts, concerns around global energy supply disruptions persisted, with Brent crude prices hovering in the $98–115 range, continuing to exert pressure on inflation expectations and overall macro stability.
3] Rupee vs Dollar
Additionally, the extended its decline, slipping past the 94 mark against the US dollar, underscoring pressure from elevated crude oil prices, global risk aversion, and sustained capital outflows. The weakness in the currency continues to be a significant concern for overall market stability.
“Rupee continued its sharp weakness, falling another 0.80% to 94.70 against the dollar, as rising crude prices intensify pressure on India’s import bill. The concern of higher crude for a prolonged period is weighing heavily on the currency and overall macro outlook. Sustained dollar demand and energy-led inflation risks are keeping the rupee under stress. Technically, 94.00 now acts as key resistance, while the next crucial support is seen near 95.00. Bias remains weak unless crude prices show a meaningful correction,” said Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities.
4] Gold and silver prices
Gold and silver prices jumped over 3% on Friday as investors stepped in to buy on dips following an earlier pullback this week, while closely watching for signs of easing tensions in the Middle East.
Spot gold gained 2.6% to $4,491.78 per ounce after touching an intraday high of $4,554.39, while spot silver advanced 2.2% to $69.54 per ounce.
“The commodities market enters the week in a phase of measured stabilisation following last week’s sharp correction, particularly in precious metals, where gold and silver witnessed aggressive profit booking after an extended rally. The recent decline has eased overbought conditions, with prices now attempting to rebuild momentum amid mixed global cues, including a firm US dollar and evolving geopolitical developments in the Middle East. While safe-haven demand has moderated slightly, underlying uncertainty continues to provide intermittent support to bullion,” Ponmudi added.
5] FII outflows
Foreign institutional investors (FIIs) sold domestic equities worth ₹1,13,810 crore in March, extending their selling streak amid the Iran–Israel conflict. So far this year, total outflows have reached ₹1,27,157 crore.
This marks the worst month so far, as foreign investors continue to pull money out of Indian markets due to heightened geopolitical tensions and risk aversion linked to the ongoing conflict.
So far this year, FIIs have been net sellers of Indian equities to the tune of ₹1.47 lakh crore, while DIIs have made net purchases amounting to ₹2.11 lakh crore.
According to VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, the poor returns from India vis-à-vis other markets – both developed and emerging- during the last eighteen months are the principal reason for FPI’s indifference towards India.
“It is important to understand that FPIs were sellers in other emerging markets, too, like Taiwan and South Korea. There is a risk-off trend in equity markets globally after the war broke out in West Asia. If their sustained selling strategy is to change, there should be an end to the hostilities in West Asia and a decline in crude prices,” Vijayakumar said.
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