Sensex, Nifty End Lower as Surging Crude Oil and Middle East Tensions Weigh on Sentiment

Indian equity benchmarks ended lower on Friday, snapping back only partially from a sharper intraday fall, as surging crude oil prices and escalating tensions in the Middle East weighed on investor sentiment through the session. The S&P BSE Sensex slipped 120.83 points, or 0.16 percent, to close at 74,781.76, while the Nifty 50 shed 79.70 points, or 0.34 percent, to settle at 23,398.10. Both indices had fallen more sharply earlier in the day before recovering a chunk of those losses by the close.

Realty and Auto Lead the Declines

The pain was concentrated in rate-sensitive and cyclical pockets of the market. The Nifty Realty index was among the worst hit, tumbling roughly 2.7 percent on the day and extending a six-session losing streak that has now wiped close to 7.6 percent off the sector gauge. Large developers bore the brunt of the selling, with steep single- and double-digit percentage declines across several prominent names. Auto and metal stocks also came under pressure, tracking the broader risk-off mood. Information technology stocks were a rare bright spot, bucking the wider market weakness even as market breadth stayed negative, with roughly 2,470 shares declining against 2,018 advancing on the BSE.

Crude Oil Keeps Climbing

The bigger story behind the day's moves was crude oil. Brent crude has surged nearly 23 percent over the past two weeks, moving from about $88 a barrel in late August to above $108 on Friday, its highest level since May, driven by escalating attacks and disruptions along key shipping routes in West Asia. Energy analysts now expect the region's crude production to stay below pre-war levels well into 2027, a notable shift from earlier expectations of a quicker recovery. Some brokerages have flagged that prices could test $120 a barrel if the disruption persists, a scenario that would keep pressure on India's import bill and stoke fresh concerns about inflation and fuel-retailer margins.

Global Cues Stayed Cautious

Sentiment was not helped by weak global cues. US equities fell for a fourth straight session on Thursday as Treasury yields climbed toward the 5 percent mark on the back of hotter-than-expected producer price data, with investors bracing for the US Consumer Price Index reading due later in the day and the Federal Reserve's policy meeting scheduled for September 15-16. Asian markets mostly ended lower for similar reasons, though European shares were an exception, helped by stronger-than-expected UK growth data. US index futures pointed to a firmer open on Wall Street, offering a tentative sign that the risk-off mood may ease into the weekend.

What's Next for Markets

Beyond the immediate trading session, attention in Delhi is also turning to the 18th BRICS Summit, which India is hosting on September 12-13 as this year's chair. While not a market-moving event in the traditional sense, the gathering underscores a busy few days for policy and diplomatic headlines that could feed into broader market sentiment alongside the ongoing crude oil and central-bank narratives.

This is an original summary based on public reporting. See our editorial policy for how we source, write, and correct our stories.