Benchmarks End Flat as IT Recovery Offsets West Asia Concerns

An end-of-day recap of all that transpired in the Indian markets, highlighting the major price movements and the factors driving them

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By Dehuti Jani

May 18, 2026 at 11:49 AM IST

Indian equities ended largely flat on Monday after recovering from sharp intraday losses, as gains in IT stocks helped offset persistent concerns around the Iran conflict, rising oil prices and record weakness in the rupee. The Nifty50 closed 0.03% or 6.45 points higher at 23,649.95, while the BSE Sensex gained 0.10% or 77.05 points to settle at 75,315.04. Both indices had fallen as much as 1.4% during the session before staging a late recovery.

Investor sentiment remained fragile amid escalating tensions in West Asia after reports of a drone strike on a nuclear power facility in the UAE and continued attacks involving regional energy infrastructure. Donald Trump also warned Iran to act “fast” as efforts to end the conflict appeared to stall. Meanwhile, the Indian rupee weakened to another record low, closing at 96.35 against the US dollar.

Sectorally, the Nifty IT index rose over 2.0%, emerging as the top performer and helping stabilise the broader market. Tech Mahindra, Infosys and Bharti Airtel were the leading gainers on the Nifty50. Pharma and healthcare stocks also outperformed, while consumer durables and PSU banking shares lagged.

Broader markets remained under pressure, with the Nifty MidCap and Nifty SmallCap indices declining 0.15% and 1.26%, respectively. Elevated Brent Crude prices, rising global bond yields and continued foreign outflows kept overall market sentiment cautious.

Top Movers of the Day

Tech Mahindra jumped nearly 5% to around ₹1,438 as investors bought into beaten‑down IT names, helping the Nifty IT index rebound over 2% amid value‑hunting after recent sector underperformance.

Bharti Airtelgained about 2% to roughly ₹1,937.10, briefly lifting its market capitalisation back towards ₹11.8 trillion as investors continued to favour telecom over banks in a volatile, rate‑sensitive market.

Infosys climbed around 2.5% to about ₹1,146, supported by bargain hunting in large‑cap IT after a sharp global tech sell‑off and renewed hope that AI‑driven demand could offset spending cuts elsewhere.

HCL Technologies advanced just over 1% to nearly ₹1,146, extending gains in frontline IT as traders rotated into export‑oriented defensives while monitoring rupee weakness and elevated bond yields.

TCS rose about 1% to approximately ₹2,286 as the broader IT basket outperformed, with investors seeking stability in cash‑rich, high‑margin tech exporters despite global macro headwinds.

Tata Steelslumped just over 3% to around ₹210, ranking among the top Nifty losers as fears of a global slowdown, rising borrowing costs and weaker Chinese demand dragged metal stocks lower.

Power Grid Corporation dropped nearly 3% to about ₹297, extending the slide in utilities as higher bond yields and risk‑off sentiment in rate‑sensitive sectors weighed on defensive, dividend‑oriented names.

SBI fell around 2.5% to roughly ₹938, leading losses in banking as a record‑weak rupee, rising bond yields and worries over foreign selling hit large public‑sector lenders.

NTPC declined about 2.5% to nearly ₹385, tracking the broader sell‑off in PSU and rate‑sensitive shares as investors remained cautious about the impact of cost pressures and elevated energy prices.

Maruti Suzuki slipped about 1.5% to roughly ₹13,015 as concerns over higher fuel prices and macro uncertainty continued to weigh on auto demand expectations despite the intraday market recovery.

TVS Motor tumbled about 5% to nearly ₹3,291 after the company announced plans to buy a 4.9% stake in Jana Small Finance Bank, with investors fretting over capital allocation and near‑term earnings dilution.

ICICI Prudential Life Insurance plunged close to 3% after promoter Prudential plc moved to cut its stake below 10%, triggering concerns over supply overhang and prompting heavy profit‑taking in the counter.

Futures & Options
Nifty May 2026 futures closed at 23,659.00, a narrow premium of 9.05 points over the spot Nifty 50 close of 23,649.95, reflecting cautious sentiment in the derivatives market amid persistent geopolitical and macroeconomic uncertainty.

In the cash market, the Nifty 50 ended marginally higher by 6.45 points or 0.03%, while market volatility increased further with India VIX rising 4.47% to 19.63. Among stock futures, HDFC Bank, Infosys and Tata Steel were the most actively traded contracts in the F&O segment. The May 2026 derivatives series will expire on 26 May 2026.

Bonds
India’s government bond yields jumped sharply on Monday as rising Brent Crude prices and fading hopes of an end to the Iran conflict triggered a broad global bond selloff and intensified inflation concerns for India.

The benchmark 10-year government bond yield climbed to around 7.1427% during the session, hovering near a six-week high and approaching levels last seen nearly two years ago. The benchmark 6.48% 2035 bond yield ended at 7.1183%, sharply higher than Friday’s close of 7.0644%.

Investor sentiment weakened amid concerns that sustained high energy prices could worsen inflation and fiscal pressures for the world’s third-largest crude importer. Meanwhile, the Reserve Bank of India conducted a switch auction, accepting bids across all six switch lines. The largest switch involved the 7.41% GS 2036 security, with ₹99.70 billion issued under the operation.

Forex
Indian rupee weakened to another all-time low on Monday, extending its losing streak to seven straight sessions as elevated Brent Crude prices, rising global bond yields and weak capital flows continued to pressure the currency. The rupee touched a record low of 96.3875 against the US dollar before settling at 96.3450, down 0.4% from Friday’s close.

The currency has now declined around 2.0% over the past seven trading sessions, making it Asia’s weakest-performing currency this year. Investors remained concerned that elevated energy prices and persistent foreign outflows could push India toward a third consecutive year of balance of payments deficit. Traders indicated that losses were partly contained by intervention from the Reserve Bank of India.

Crypto
Crypto markets witnessed a sharp selloff on Monday as escalating tensions in West Asia, rising global bond yields and heavy leveraged liquidations triggered a broad risk-off move across digital assets.

Bitcoin fell more than 4.0% to trade below the key $77,000 support level, touching a two-week low near $76,711 during Asian and European trading hours. The broader crypto market also came under pressure after leveraged liquidations reportedly crossed $660 million. Ethereum declined nearly 6.0% toward the $2,100 level, with more than $257 million in long positions wiped out over the past 24 hours.

US Stock Futures
US stock futures fell moved lower on Monday after Wall Street closed at record highs last week, as investors turned cautious ahead of earnings from Nvidia and major US retailers while continuing to monitor the US-Iran conflict. Futures tied to the Dow Jones Industrial Average fell around 373 points or 0.8%, while S&P 500 futures declined 0.4%. Contracts linked to the Nasdaq-100 slipped 0.3%.

Investor sentiment was also pressured by rising oil prices, with Brent Crude climbing 1.0% to $110.29 per barrel and West Texas Intermediate crude rising 0.9% to $106.41. Elevated energy prices continued to fuel concerns around inflation, bond yields and the broader economic impact of tensions in West Asia.

US Treasury Notes
Yields on US Treasury climbed sharply on Monday as surging Brent Crude prices and escalating tensions in West Asia triggered heavy selling across global bond markets. The benchmark 10-year Treasury yield rose as high as 4.631%, its highest level since February 2025, before easing slightly to around 4.603%.

The long-end 30-year Treasury bond yield climbed to 5.131%, while the policy-sensitive 2-year Treasury yield rose to 4.086%, reflecting growing concerns that inflationary pressures could keep US interest rates elevated for longer. Investors also reassessed the Federal Reserve outlook under incoming Chair Kevin Warsh amid rising energy costs and persistent geopolitical uncertainty.

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