Nifty, Global Tensions, and Oil Prices: Weekend Developments Impact Indian Stock Market

Indian Stock Market Expected to Open Lower on Monday

The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open lower on Monday following a crash in global markets due to the renewed conflict in the Middle East. The conflict has dampened hopes of an end to the wider US-Iran war, leading to a decline in investor sentiment.

The Sensex declined 116.67 points, or 0.16%, to close at 74,243.34 on Friday, while the Nifty 50 settled 49.85 points, or 0.21%, lower at 23,366.70. The Reserve Bank of India (RBI) raised inflation forecast and slashed growth projections while maintaining the repo rate unchanged in its June monetary policy.

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Investors will closely monitor energy prices, the ongoing West Asia conflict, progress in monsoon, Foreign Institutional Investors (FIIs) fund flows, and the impact of RBI's measures for further direction, according to Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd.

Global Market Cues

Asian markets traded lower on Monday amid escalating war in the Middle East and surging crude oil prices. Japan's Nikkei 225 declined 3.66%, while the Topix dropped 2.41%. South Korea's Kospi crashed 8.4%, while the Kosdaq plunged over 7%. Hong Kong Hang Seng index futures indicated a lower opening.

The US stock market ended sharply lower on Friday, ending its nine-week winning streak, weighed down by a sharp slump in technology stocks. The Dow Jones Industrial Average declined 695.15 points, or 1.35%, to 50,866.78, while the S&P 500 slipped 200.57 points, or 2.64%, to 7,383.74. The Nasdaq Composite closed 1,121.53 points, or 4.18%, lower at 25,709.43.

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The US economy posted a third straight month of strong job gains in May, with nonfarm payrolls increasing by 172,000 jobs last month after rising by an upwardly revised 179,000 in April. India's economy expanded 7.8% in the January-March quarter of FY26, exceeding forecasts on strong domestic demand and government expenditure. Japan's economy grew slower than initially estimated in the January-March quarter from the previous three months. Crude oil prices rallied after Israel launched renewed strikes on Lebanon despite a truce between the two countries.