Indian equities end week nearly flat as oil and yields offset earnings support

Indian equities finished the week with little net change as support from domestic institutions and stronger-than-expected June-quarter earnings offset pressure from expensive crude, higher bond yields and geopolitical uncertainty. The final session was also narrowly mixed: Power Grid, HDFC Life, Kotak Mahindra Bank, Nestle India and Bharat Electronics supported the benchmarks, while Maruti Suzuki, Trent, IndiGo, Infosys and HCL Technologies lagged.

The market’s internal rotation was clearer than the benchmark outcome. Power and selected financial stocks attracted buying, while IT, auto and healthcare remained under pressure. The recorded sector leadership in power was consistent with defensive positioning and interest in infrastructure-linked earnings, while the weakness in IT reflected sensitivity to global risk appetite and US yields. Auto and aviation-linked names remained exposed to the implications of elevated oil prices. These are market interpretations rather than an established single-cause explanation.

The week began with selling in technology and healthcare stocks. Infosys, HCL Technologies, TCS and Sun Pharma were among the reported drags, while Hindalco, Tata Steel, Axis Bank and HDFC Life provided support. Market reports attributed the early caution to elevated crude prices, geopolitical uncertainty and weak global cues.

Banks became a more important stabilising force as the week progressed. Axis Bank led the reported gainers on August 18, while Kotak Mahindra Bank, Bajaj Finance, Shriram Finance and other financial names supported the later rebound. Power Grid was a recurring source of strength. The inference from the trading pattern is that domestic liquidity and selective earnings confidence were cushioning the effect of foreign selling, rather than that risk appetite had broadly returned.

The sector pattern also explains why the benchmark response was muted. Power and infrastructure names benefited from defensive rotation and fresh order-related attention, while Pharma and Health saw stock-specific selling. IT remained vulnerable to global technology weakness and higher US yields. Auto weakness was visible in Maruti Suzuki and Tata Motors Passenger Vehicles, while IndiGo’s decline was linked in market commentary to crude and aviation-fuel sensitivity.

Foreign institutional investors were net sellers on three of the five sessions. Based on the reported daily figures, their net selling for the week was Rs 1,601.65 crore. Domestic institutional investors were net buyers on each session, providing the principal counterweight; on Friday they bought equities worth Rs 2,124.14 crore on a provisional basis.

The flow split mattered because it limited the market’s response to global pressure. The reported data show domestic buying absorbing part of the foreign outflow, but the continued FII selling also points to a market still sensitive to global yields, oil and currency conditions. That is an interpretation of the flow data, not a claim that domestic institutions fully offset the underlying risk.

Global markets remained a headwind. Most Asian share indices were heading for weekly declines as US Treasury yields rose and oil prices reached one-month highs amid a diplomatic deadlock in the Gulf. Wall Street’s main indexes recovered modestly on Friday after a sharp fall in the previous session, but remained on course for weekly losses as investors weighed bond-market stress, fiscal concerns, inflation and geopolitical risk.

The US 10-year yield touched 4.71% in the Friday market coverage, while Brent remained more than 5% higher for the week. The dollar index was reported down almost 0.9% for the week. For India, the combination matters through imported energy costs, pressure on the external balance, domestic bond yields and the relative attractiveness of emerging-market assets. The rupee’s reported Friday level and the cross-asset readings above provide the market snapshot; the implication is that global conditions remained restrictive even as domestic equities held broadly steady.

SEBI Chairman Tuhin Kanta Pandey said the Closing Auction Session would remain in place, while allowing for operational adjustments. SEBI also launched an Incident Reporting Portal and a Cyber Suraksha Portal, aimed at more structured reporting and information-sharing across the securities-market ecosystem. The regulator separately revised the application form for mutual-fund registration and issued a consultation paper on fixed-income channel partners for online bond platforms.

The Finance Minister said the government would soon name members of a high-level committee on banking changes. Separately, the government approved 31 electronic-component manufacturing proposals involving Rs 7,877 crore of investment. These measures are relevant to listed financial, asset-management, electronics and infrastructure companies, although the material does not establish an immediate earnings impact.

The RBI reportedly asked credit-rating agencies not to identify it as the regulator of bank deposits in their rating communications. Market commentary also linked the rise in the Indian 10-year yield to hawkish RBI meeting minutes, domestic inflation risks and tighter liquidity. No fresh CPI, IIP, GST, trade or PMI release for this week was available in the supplied material.

The June-quarter earnings season provided a fundamental counterweight to the macro pressure. Nomura said Nifty 50 earnings growth was 4% year-on-year, one percentage point above consensus, while broader Q1 FY27 analyses reported that sales, EBITDA and profit growth for the tracked India Inc universe exceeded expectations. The estimates differ by universe and methodology, so they should not be treated as interchangeable. The common reported conclusion was that earnings were better than feared, but geopolitical risks continued to limit upgrades.

Company-specific developments were more visible in mid-cap and infrastructure names. Kalpataru Projects International reported June-quarter net profit of Rs 312 crore, up 46% year-on-year, with revenue up 4% to Rs 6,408 crore; it also received new orders and notifications of award worth approximately Rs 3,526 crore. Schneider Electric Infrastructure reported quarterly order intake of Rs 915 crore and an order backlog of Rs 2,169 crore, but profit after tax fell 69.8% year-on-year to Rs 12.4 crore as commodity-price volatility, delayed pass-through and lower operating leverage weighed on profitability.

Welspun Corp’s $1.8 billion pipe-supply order from its US manufacturing facility was its largest single order, according to the company coverage, and lifted its order book to $4.4 billion. RailTel received a Rs 164.78 crore work order from Western Coalfields, while Saatvik Solar Industries received a Rs 190 crore solar-module supply order. Data Patterns secured an order worth Rs 585.76 crore from Bharat Electronics. The market response to such announcements was stock-specific; the reported orders improve visibility, but execution timing remains the relevant follow-through.

The primary market was active, with six mainboard and two SME issues scheduled in the week according to the IPO calendar. Horizon Industrial Parks sought Rs 2,600.04 crore and Lalithaa Jewellery Mart Rs 1,700 crore; Gaja Alternative Asset Management and Dhanwel Hybrid Seeds were among the issues that closed on Friday. Technocrats Plasma Systems was among the reported SME listings.

Bulk and block-deal activity included the purchase of 2,064,713 Shanthi Gears shares at Rs 375.30 on August 21, along with reported bulk purchases in Reliance Industrial and other companies. The material does not provide a complete week-wide total for block and bulk deals or subscription data for every issue.