Nifty Slips as US-Iran Tensions Lift Oil, Global Yields; Rupee Gains

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By Tresha Dias

August 31, 2026 at 1:16 PM IST

Benchmark equity indices ended lower on Monday, weighed by losses in IT, metal, realty and media shares amid weak global cues.

The Sensex fell 307.24 points, or 0.40%, to 76,957.27, while the Nifty50 declined 95.25 points, or 0.39%, to 24,080.40. Stock-specific buying in the broader market helped the indices recover from intraday lows, while investors awaited the release of April-June 2026-27 GDP data and tracked festival demand and GST collections.

Escalating US-Iran tensions and fading hopes of a diplomatic breakthrough pushed crude oil prices higher, reviving concerns over energy-led inflation and a higher-for-longer interest-rate environment. Fed Chair Kevin Warsh's hawkish comments at Jackson Hole also increased expectations of a September rate hike, keeping global yields elevated and fuelling volatility in emerging markets.

Adani Enterprises, Adani Ports and Special Economic Zone and Eternal were the top Nifty50 losers. In the broader market, the Nifty MidCap rose 0.24%, while the Nifty SmallCap fell 0.74%. Sector-wise, Nifty Media, Metal, Realty and IT underperformed, while Auto and Private Bank indices outperformed.

The Indian rupee strengthened 0.2% to ₹95.1625 per dollar today, its highest level since August 5, supported by inflows linked to an MSCI index rejig and sustained intervention by the Reserve Bank of India. The currency gained 0.2% in August, after falling 0.8% in July.

The benchmark 6.94%, 2036 bond ended at 6.9452%, compared with 6.9108% at previous close.

Top Movers of the Day

Avantel rose 2.46% to ₹160.65 after securing a ₹1.2 billion contract from the Defence Research and Development Organisation under the Ministry of Defence. The order involves developing, installing and commissioning a ground-segment hub for voice and data communication and is scheduled for execution by February 2029.

Piramal Finance gained 1.45% to ₹2,311.20. The company raised ₹21 billion through a qualified institutional placement, strengthening its capital base to support its retail-led growth strategy. The QIP attracted participation from domestic mutual funds and global investors, and the company has also received approval for a proposed ₹17.5 billion promoter warrant issue, taking the potential capital raise to ₹38.5 billion.

Shree Renuka Sugars climbed 3.48% to ₹24.98 as sugar stocks continued to benefit from a sharp rise in domestic sugar prices. Retail sugar prices have climbed significantly in recent weeks, supporting sentiment towards sugar producers, although industry officials have attributed the rally partly to speculative buying rather than an actual supply shortage.

Balrampur Chini Mills surged 5.06% to ₹688 as firm sugar prices, concerns over cane availability and expectations of stronger festive-season demand boosted sentiment. The government's move to cap bulk consumers' sugar inventories at 15 days' requirement from September 1 also supported the sector.

Leela Palaces Hotels gained as much as 3.03% to ₹571 after Jefferies initiated coverage with a Buy rating and a ₹675 target. The brokerage cited the company's owned-room expansion, Brookfield backing and rising demand for luxury and experiential travel, and expects 19-20% EBITDA and PAT CAGR through 2028-29.

Maruti Suzuki India advanced 0.59% to ₹13,455 after raising its planned capital expenditure to ₹77.5 billion through 2030-31. The investment is aimed at expanding production capacity, launching new models and increasing research and development spending, supporting the company's long-term growth outlook.

Axiscades Technologies rose 4.97% to ₹1,674 after announcing the acquisition of a majority stake in Cloud Wave Technologies, a precision-engineering and manufacturing company. The transaction is aimed at accelerating Axiscades' aerospace manufacturing capabilities and adding operational precision-manufacturing capacity.

Ashoka Buildcon surged 6.08% to ₹119.50 after receiving a ₹6.02 billion Letter of Acceptance from Rail Vikas Nigam for electro-mechanical works across four railway tunnels under the Rishikesh-Karnprayag rail project in Uttarakhand. The 30-month contract is expected to strengthen the company's order book.

Sterlite Technologies climbed 0.86% to ₹730 after signing a three-year, $288 million long-term supply agreement with a leading hyperscaler for high-density optical fibre cables. The contract covers supplies from 2027 to 2029, with an option to extend the agreement by two years, strengthening the company's visibility in the data-centre and digital-infrastructure market.

Zee Entertainment Enterprises slumped 7.65% to ₹93.74 after creditors moved to challenge the NCLT's approval of Subhash Chandra's repayment plan. LIC Housing Finance, HDFC Bank and Union Bank are among the lenders seeking to challenge the plan before NCLAT, increasing uncertainty around the insolvency proceedings.

Waaree Energies fell 1.89% to ₹2,590 despite announcing a $37 million capital expenditure plan for its Arizona manufacturing facility. The investment will replace existing module-production lines and raise the Arizona plant's capacity from 1 GW to 1.6 GW, taking the company's total US manufacturing capacity to 4.8 GW.

Futures & Options
Nifty September 2026 futures closed at 24,245, a premium of 164.6 points over the Nifty 50's cash-market close of 24,080.45. The Nifty 50 declined 95.25 points, or 0.39%, to 24,080.45, while the India VIX rose 3.37% to 11.04, indicating higher near-term volatility expectations.

HDFC Bank, Eternal and Reliance Industries were the most-traded individual stock futures contracts on the NSE. The September 2026 F&O contracts expire on September 29, 2026.

Bonds
The benchmark 6.94% 2036 bond ended at 6.9452%, compared with 6.9108% at the previous close.

GDP grew 7.8% in April-June, beating the 7.4% median forecast in the 91bps poll, while it was within the market's expectation of around 7.2%-7.8%. The stronger-than-expected data prompted some traders who had positioned for a weaker print to reverse their bets, although the reaction in government bonds remained relatively measured.

With growth proving stronger than the RBI's assessment, traders expect inflation to gain greater weight in the policy outlook, as the central bank has less need to support activity through monetary easing.

Forex
The Indian rupee strengthened 0.2% to ₹95.1625 per dollar today, its highest level since August 5, supported by inflows linked to an MSCI index rejig and sustained intervention by the Reserve Bank of India. The currency gained 0.2% in August, after falling 0.8% in July.

The rupee reversed early losses around midday as the RBI's intervention helped cushion it against adverse external pressures, traders said. The dollar also came under selling pressure as foreign banks offered dollars linked to MSCI-related inflows, further supporting the rupee.

Crypto
The cryptocurrency market traded higher today, with Bitcoin and Ethereum advancing as major digital assets extended their gains.

Bitcoin traded near $77,492.49 today, up 0.50%, with a market capitalisation of $1.56 trillion and 24-hour trading volume of $21.53 billion. The cryptocurrency held above the $77,000 mark as buying interest supported the market.

Ethereum traded near $2,413.40 today, up 1.40%, with a market capitalisation of $291.25 billion and 24-hour trading volume of $12.35 billion. The second-largest cryptocurrency outperformed Bitcoin, extending gains as broader demand for major digital assets remained firm.

US Stock Futures
US stock futures fell today after combat resumed between the United States and Iran for the first time in a month. Dow futures slipped 64 points, or 0.12%, while S&P 500 futures fell 0.1% and Nasdaq-100 futures were marginally lower.

US Treasury Notes
US Treasury yields edged higher today, with the benchmark 10-year yield trading around 4.70%, after rising for three consecutive sessions as hawkish remarks from Federal Reserve Chair Kevin Warsh increased expectations of a September rate hike. In his Jackson Hole address on Friday, Warsh said underlying inflation trends had not meaningfully improved and reaffirmed the Fed's commitment to its 2% inflation target.

Markets were pricing in around a 57% probability of a 25-basis-point rate hike in September, up from about 40% a week earlier. A surprise upward revision to the University of Michigan's consumer sentiment index also supported yields, while investors turned their attention to Friday's August jobs report for further clues on the Fed's policy path.

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