HOME > MARKETS > MARKET COMMENTARY
  MARKET COMMENTARY
EQUITY
Markets end lower for 3rd straight session amid rising geopolitical tensions
May-11-2026

Indian equity benchmarks fell for the third day running on Monday, as rising crude oil prices and escalating geopolitical tensions weighed heavily on investor sentiment after the US and Iran failed to reach a peace agreement to end the West Asia conflict. Rupee weakness, coupled with concerns over sustained foreign capital outflows, further dampened market sentiment.

Some of the important factors in trade:

India’s economic growth to slow to 6.7% in FY27 amid oil price shock from Iran war: BMI, a Fitch Group firm, has forecasted that India’s economic growth to slow to 6.7% in the current fiscal (FY27), from 7.7% growth in FY26 on account of waning momentum and oil price shock from Iran war, though tax reforms offer partial offset. 

India, Canada to hold next round of negotiations for proposed FTA in July in Ottawa: The Commerce Ministry has said that India and Canada will hold the next round of negotiations for the proposed free trade agreement (FTA) in July in Ottawa, Canada. The second round of negotiations for the proposed Comprehensive Economic Partnership Agreement (CEPA) was held from May 4 to May 8 in New Delhi. 

Private Sector Capex rises 67% to Rs 7.7 lakh crore in September 2025: Pointing a revival in India’s investment cycle, the Confederation of Indian Industry (CII) has said that private sector capital expenditure in India has increased by 67% to Rs 7.7 lakh crore in September 2025 from Rs 4.6 lakh crore a year ago. 

India, Switzerland review progress on TEPA; eye greater trade, investment collaboration: India and Switzerland held talks to advance the implementation of the India-EFTA Trade and Economic Partnership Agreement (TEPA) and strengthen trade and investment engagement between two countries. For this, Commerce Secretary Rajesh Agarwal undertook an official visit to Switzerland from May 06-07, 2026. 

Global front: European markets were trading mostly in red as a lack of progress in the U.S.-Iran peace talks sent oil prices soaring and revived inflation fears. Asian markets ended mostly higher as strong gains in AI-related stocks in Seoul offset investor concerns over escalating Iran-U.S. tensions and prolonged disruption in the Strait of Hormuz. 

Finally, the BSE Sensex fell 1312.91 points or 1.70% to 76,015.28 and the CNX Nifty was down by 360.30 points or 1.49% to 23,815.85.

The BSE Sensex touched high and low of 76,678.52 and 75,957.40, respectively. There were 6 stocks advancing against 24 stocks declining on the index. 

The lone gaining sectoral index on the BSE was Healthcare up by 0.61%, while Consumer Durables down by 3.76%, Realty down by 2.74%, Consumer Discretionary down by 2.14%, Power down by 2.13% and Capital Goods down by 2.09% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.36%, Hindustan Unilever up by 0.85%, Adani Ports &SEZ up by 0.36%, Kotak Mahindra Bank up by 0.14% and Axis Bank up by 0.13%. On the flip side, Titan Company down by 6.83%, Interglobe Aviation down by 4.69%, SBI down by 4.52%, Bharti Airtel down by 4.18% and Eternal down by 4.08% were the top losers.

Meanwhile, BMI, a Fitch Group firm, has forecasted that India’s economic growth to slow to 6.7% in the current fiscal (FY27), from 7.7% growth in FY26 on account of waning momentum and oil price shock from Iran war, though tax reforms offer partial offset. It also said that the prospect of the Iran-US conflict escalating in scope presents downside risk to its growth outlook and India must balance spending needs on defence and fuel price stabilisation against fiscal consolidation agenda. It said the tax reforms in GST and income tax carried out in 2025 will partly offset effects of cost-push inflation, and added that looser monetary policy will support capital spending, as increased uncertainty amid the war and higher input prices hurt investment.

The agency estimates that India's economy grew 8% y-o-y in the January-March quarter of 2026, faster than its original 7.8% projection. It has revised its growth forecast for 2025-26 upwards by 0.1 percentage points to 7.7%. though, it maintained its forecast of 6.7% GDP growth during FY27 due to their belief that the effects of last year's tax reforms will fade as input costs increase in the new fiscal year. It said one factor behind the unchanged FY27 forecast is its assessment that the effects of last year's tax reforms will dissipate by April-June quarter of 2026.

It said such waning is already apparent in the vehicle registrations data, showing new registrations grew 9% y-o-y in April after rising 23% in January-March. Likewise, while electricity generation grew 2.7% y-o-y last quarter, the growth was driven by power demand in January-February. During March, electricity consumption rose by a mere 0.9% y-o-y. It also anticipates restricted supply of energy and food in FY27 to slow consumption growth while raising price inflation. It said that conflict in Iran has already curtailed supplies and that has already been factored in the 6.7% growth estimate for FY27. However, India's weather department is also predicting 'below normal' rainfall during this year's monsoon (June-September) due to El Nino. 

BMI said its models indicate that GDP growth will fall by up to 0.4-0.7percentage points if the price of Brent Crude rises to around $90/bbl. The size of this impact makes India's economy amongst the most sensitive to changes in energy prices within Asia. Crude prices have jumped to $105/barrel after the United States rejected Iran's peace proposal, rekindling fears that the blockade of the Strait of Hormuz will continue for a longer time. The prices have jumped from about $73/ barrel level prevailing before the war started on February 28. Crude prices touched a 4-year high of $126/barrel on April 30.

CNX Nifty touched high and low of 23,997.45 and 23,799.10, respectively. There were 11 stocks advancing against 39 stocks declining on the index. 

The top gainers on Nifty were Tata Consumer Product up by 8.05%, Max Healthcare Inst up by 2.72%, Coal India up by 1.59%, Sun Pharma up by 1.47% and Hindustan Unilever up by 0.97%. On the flip side, Titan Company down by 6.85%, Interglobe Aviation down by 4.73%, SBI down by 4.36%, Eternal down by 4.03% and Jio Financial Services down by 3.81% were the top losers.

European markets were trading mostly in red; France’s CAC fell 87.87 points or 1.08% to 8,024.70 and Germany’s DAX lost 113.43 points or 0.47% to 24,225.20, while UK’s FTSE 100 increased 5.24 points or 0.05% to 10,238.31.

Asian markets ended mostly higher on Monday tracking Wall Street’s gains last Friday on the back of upbeat US labour data and strength in Nvidia, SanDisk and other AI-related stocks. Data showed that non-farm payroll employment shot up by 115,000 jobs in April after an upwardly revised 185,000 jobs in March, while the unemployment rate held steady at 4.3%, reinforcing expectations that the Federal Reserve is likely to leave interest rates unchanged for some time. Chinese shares surged, supported by strong trade data and as inflation data topped estimates. Data showed that China's consumer inflation continued a mild recovery in April while producer inflation surged to a 45-month high. China's April exports jumped 14.1% year-on-year to $359.4 billion, well above expectations of a 7.9% rise, while imports surged 25.3% to a record $274.6 billion, lifting the trade surplus to $84.8 billion. However, Nikkei fell from record highs as oil prices surged after US President Donald Trump rejected Iran’s response to his peace proposal, leaving the Strait of Hormuz effectively shut. Investors shifted their focus on the upcoming Trump-Xi meeting in Beijing, where discussions are expected to cover the Middle East conflict, Taiwan, and potential renewed trade talks.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

4,225.02

45.07

1.08

Hang Seng

26,406.84

13.13

0.05

Jakarta Composite

6,905.62

-63.78

-0.92

KLSE Composite

1,745.31

-2.75

-0.16

Nikkei 225

62,417.88

-295.77

-0.47

Straits Times

4,942.77

20.87

0.42

KOSPI Composite

7,822.24

324.24

4.32

Taiwan Weighted

41,790.06

186.12

0.45
  RELATED NEWS >>
Most Viewed >>
EXPLORE
© CITRUS INTERACTIVE
Designed & Developed Accord Fintech Pvt. Ltd.