Mumbai, Sep 20 : The Indian stock market is likely to remain sensitive to developments around the US-Iran conflict, crude oil prices, US tariff moves and global bond yields in the coming week, with foreign fund flows and rupee movement also expected to influence investor sentiment.
Market participants will closely watch developments on the diplomatic front between the US and Iran, as any signs of progress or escalation could have implications for crude oil prices, global risk appetite and equity markets.
US tariff developments will also remain in focus. 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.
The move could have implications for major importers such as India and China and may influence global trade and energy flows.
Crude oil prices are likely to remain a key market driver, particularly amid concerns that sustained higher energy costs could add to inflationary pressures and weigh on economic growth.
Foreign institutional investor (FII) and foreign portfolio investor (FPI) 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 (DIIs) also remained net buyers, with net purchases of Rs 1,019.69 crore on the day.
The rupee-dollar movement is expected to add another layer of volatility to equities, particularly amid elevated crude prices and changing global bond yields.
The Indian stock market ended the truncated trading week on a weak note, weighed down by higher crude oil prices and rising global bond yields. Concerns over the near-term inflationary impact of higher energy costs and their potential drag on economic growth continued to weigh on investor sentiment.
For the week, the Sensex declined 0.65 per cent to close at 74,294.46, while the Nifty slipped 0.22 per cent to end at 23,346.40.
Broader market indices, including the midcap and smallcap segments, remained largely flat after a volatile week, following several weeks of outperformance.
Investors are likely to track global developments closely in the coming sessions, with geopolitical tensions, energy prices, foreign fund flows and currency movements expected to remain key factors for market direction.
