A man checking stock market data on tablet
Center-Center-DelhiIndian equities snapped their prolonged eight-week losing streak, their longest falling streak in 25 years, to register a positive weekly close, with the benchmarks NSE Nifty 50 settling at 22,520 and the BSE Sensex at 72,472, up around 0.5–0.8% over the week respectively. Much of the rebound came on Friday after IT major Tata Consultancy Services (TCS) on Thursday reported robust quarterly (Q2FY27) earnings, leading to strong buying interest across the IT pack.
While market experts expect Q2 earnings to remain strong, they also feel that major global headwinds - elevated global crude prices and US bond yields - will continue to weigh on sentiments and limit the recovery. So far in 2026, Nifty50 has declined 14%.
Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services, said that Indian equities are expected to consolidate this week as markets balance improving domestic earnings momentum against elevated global risks.
“Brent crude remains above USD 100 per barrel and sustained FII selling continues to weigh on sentiment. After eight consecutive weeks of declines, the Nifty-50 gained 0.4% last week, suggesting some stabilisation at lower levels, although the broader market is likely to remain selective,” added Khemka. He feels that persistent foreign selling and currency weakness could limit the sustainability of the recent market recovery.
In a major setback for the Indian market, foreign institutional investors (FIIs) have withdrawn Rs 44,166 crore from Indian equities so far in October 2026, bringing the total outflows this year to more than Rs 3 lakh crore as elevated crude oil prices, a strong dollar index and higher US bond yields weigh on investor sentiment.
Ajit Mishra, SVP – Research, Religare Broking said that investors will track September CPI and WPI inflation data for cues on price pressures following the RBI’s recent rate hike and shift towards calibrated tightening. Mishra stated that the market is likely to remain cautious as crude oil prices, geopolitical developments and global bond yields continue to influence near-term direction.
“A sustained rise in crude could add to inflationary pressures and weigh on the rupee and corporate margins, while easing energy prices following progress on Iran-US negotiations could provide some relief. The improving domestic growth outlook remains a positive factor, but external risks warrant a measured approach towards fresh positions,” added Mishra.
The Q2 FY27 earnings season will also gather momentum, with HCL Technologies, Hero MotoCorp, Tech Mahindra, Wipro and Nestle India scheduled to announce results. Corporate guidance and commentary on demand and margins will be key to assessing the earnings outlook.
Motilal Oswal Financial Services (MOFS) expects 22% year-on-year earnings growth for its universe and 27% growth for the Nifty-50 in 2QFY27, even as global uncertainty, FII outflows and elevated energy prices weigh on sentiment. In its India Strategy Q2FY27 Preview Report, MOFS sees earnings growth extending into FY27 and FY28. PAT for the MOFSL universe (399 companies) is expected to grow 15% in FY27 and 17% in FY28, while Nifty-50 PAT is expected to grow 17% and 13%, respectively.
The brokerage added that the next phase of the market will depend on several key factors. “Global interest rates and capital flows remain important, particularly as higher global bond yields could encourage investors to move towards fixed income and away from emerging-market equities.”
“Elevated crude oil prices and input costs could also put pressure on corporate margins. The sustainability of the AI-led global trade, the direction of FII flows and the ability of the market to absorb a robust pipeline of IPOs and other capital-raising activity will also influence market liquidity and sentiment,” MOFS said in its report.