Equities Post Worst Week in Over a Year as Oil Surges to 20-Month High

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

India stocks fall, rupee fall

By Dehuti Jani

Dehuti Jani is an experienced project manager who also works as an independent financial journalist.

March 6, 2026 at 11:38 AM IST

Indian equity benchmarks closed lower on Friday to log their worst weekly performance in over a year, as the escalating US-Israeli war with Iran drove Brent crude to a 20-month high of $87.66 per barrel, putting it on course for a near 20% weekly surge, the sharpest since March 2022 in the aftermath of Russia's invasion of Ukraine. The Nifty50 fell 1.27% or 315.45 points to 24,450.45, while the BSE Sensex dropped 1.37% or 1,097 points to 78,918.90, with heavyweight financials leading the drag. For the week, both indices lost approximately 2.9%, marking the Sensex's steepest weekly decline since December 2024 and the Nifty's worst since February 2025. India VIX surged 11.32% to 19.88, reflecting persistently elevated investor anxiety. Bloomberg reported that shipping activities in the Strait of Hormuz came to a near total halt as the conflict continued, fuelling fears of a severe energy supply shock that could substantially increase inflationary pressures and strain India's current account and fiscal balance.

Broader markets held up comparatively better, with the Nifty Midcap 100 and Nifty Smallcap 100 declining 0.69% and 0.24% respectively on the day. Among sectors, Nifty Private Bank was the worst performer, shedding 2.27%, with Nifty Bank and Nifty Financial Services also among the top losers as investors rotated away from rate-sensitive financials amid the inflation concerns. Nifty IT was a rare bright spot, eking out marginal gains to outperform all other sectoral indices on the day, even as the broader market mood remained firmly risk-off with no clear near-term resolution to the West Asia conflict in sight.

Top Movers of the Day

Garden Reach Shipbuilders & Engineers gained around 5% to trade near ₹2,530 as defence stocks continued to attract buying interest amid geopolitical tensions.

Indian Oil Corp remained in focus after announcing a second interim dividend of ₹2 per share for FY26, supporting trading activity in the stock.

Mazagon Dock Shipbuilders, Bharat Electronics and other defence counters advanced as the Nifty Defence index extended gains, reflecting increased investor interest in the sector.

InterGlobe Aviation (IndiGo) slipped about 2% during the session, emerging among key losers as aviation stocks remained sensitive to rising fuel price risks.

ICICI Bank declined around 3% as financial stocks dragged the benchmarks lower during the day’s trade.

Breweries and distilleries stocks surged up to 7% on the NSE after Karnataka Chief Minister Siddaramaiah announced a shift to global taxation standards and complete deregulation of alcohol pricing. Radico Khaitan, Tilaknagar Industries and United Spirits each rallied 7%, while United Breweries, Allied Blenders and Distillers and Globus Spirits gained 5% each, all outperforming a weak broader market.

AWL Agri Business hit its 16th record low of the calendar year, touching ₹176.93, extending a downward spiral that has seen the stock plunge over 25% since January 2026.

Astral hit a 52-week high of ₹1,705, gaining 2% on the BSE, bucking the weak broader market trend.

IRCON International and Rail Vikas Nigam attracted strong buying interest after reports suggested the government may consider merging the two railway PSUs, though specific price moves were not immediately available.

PB Fintech fell over 3% after approximately 4.84 million shares changed hands through three block deals in early trade on the NSE.

Fractal Analytics jumped 9% after reporting a 8.6% year-on-year rise in net profit to ₹1.001 billion for the third quarter of FY26, with revenue from operations growing 20.8% to ₹8.544 billion from ₹7.072 billion in the same period a year ago.

Reliance Industries rose over 2% after the US issued a general licence allowing some Russian oil sales to India, offering partial relief to the country's energy supply concerns amid the West Asia conflict.

Futures & Options
Nifty March 2026 futures closed at 24,565.20, a premium of 114.75 points over the spot Nifty, which slumped 315.45 points or 1.27% to settle at 24,450.45 in the cash market. The widening premium reflected active hedging and defensive positioning in the March series as sentiment deteriorated sharply through the session. India VIX soared 11.32% to 19.88, marking its third gain in four sessions and keeping volatility expectations firmly elevated as the West Asia conflict showed no signs of near-term resolution. HDFC Bank, Reliance Industries and ICICI Bank were the most actively traded stock futures contracts in the F&O segment on the NSE. The March 2026 derivative contracts are set to expire on 30 March 2026.

Bonds
Indian government bond yields rose on Friday as dealers held back from adding risk ahead of a key auction. The benchmark 6.48% 2035 bond yield ended at 6.6959%, up sharply from 6.6406% at Thursday's close as the market gave back much of its recent gains. The 10-year yield was trading close to levels seen before the outbreak of the US-Israeli war with Iran, underscoring how the conflict has effectively unwound the bond market's earlier rally and brought the demand-supply balance back into sharp focus.

Forex
The Indian rupee edged marginally lower on Friday to close at 91.74 per dollar, capping its worst weekly decline in over a month as the US-Israel war on Iran sparked a surge in oil prices, jolted global markets and triggered a broad dash for safe-haven assets. The rupee had plunged to a record low of 92.3025 per dollar earlier in the week before staging a sharp recovery, aided by aggressive Reserve Bank of India intervention in the foreign exchange market, though the currency still ended the week down 0.8%, underscoring the persistent pressure from the ongoing West Asia conflict.

Crypto
Crypto markets reversed course on Friday as optimism over a potential US-Iran peace evaporated, dragging most major tokens back into the red after the previous session's sharp relief rally. Bitcoin slipped to $70,924, pulling back from its recent surge above $72,000, while Ethereum dropped to around $2,077 and Solana, XRP and Dogecoin all trended lower through the session. The total crypto market capitalisation declined 1.92% to $2.41 trillion, reflecting a broad pullback as geopolitical uncertainty reasserted itself and risk appetite across digital assets cooled once again.

US Stock Futures
US stock futures edged modestly higher on Friday morning, S&P 500 contracts up around 0.1%, as investors weighed a cooling jobs outlook against sticky cost pressures ahead of the February nonfarm payrolls report. Consensus expectations pointed to just 59,000 new jobs, which would signal a very modest pace of hiring, while the unemployment rate was seen holding steady at 4.3% and wages were forecast to rise 0.3% month on month, indicating pay packets continue to edge higher. Adding to the inflation concerns, US labour costs climbed 2.8% quarter on quarter in late 2025, suggesting the cost of hiring and retaining workers remains a persistent source of price pressure for businesses.

US Treasury Notes
US Treasury yields stayed near recent highs on Friday as investors considered inflation risks from rising West Asia tensions and strong economic data. The 10-year note yield climbed to 4.15%, marking a four-day gain amid worries that higher oil prices, fuelled by the US-Israel offensive against Iran, could drive up inflation. Traders now expect the next Federal Reserve rate cut no earlier than September or October 2026, later than previous estimates.

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