The 50-stock index fell 488.05 points, or 2.06%, to close at 23,151.10.
Rupak Dee, senior technical analyst at LKP Securities, said the index has moved away from the 200-DMA as selling intensity increased. The RSI has entered the watch zone and the trend remains weak, he added, expecting further declines with the RSI remaining in deeply oversold territory.
“In the short term, the trend may remain weak, with any upside likely to be sold. On the downside, the index may fall to 23,000-22,800, while holding resistance at 23,400.”
1. The Iran-Israel war
When global markets open on Monday, the Iran-Israel war will have entered its 17th day. Markets are expected to remain volatile as long as the conflict continues.
While signs of a truce between the warring sides appear remote, AFP reported that Iran has vowed to deliver what its foreign ministry spokesman described as an “unforgettable lesson” to its adversaries in the United States and Israel.
AFP quoted Iranian diplomat Ismail Baqai as saying: “We cannot accept that they talk now and then about talks and a cease-fire, and after that we face the repetition of these crimes and war. Our armed forces are very determined to teach the enemy an unforgettable lesson.”
2. Fed FOMC
The US Federal Reserve’s policy meeting will be closely watched this week amid concerns that the ongoing dispute could disrupt inflation dynamics if it continues.
The rate-setting committee will begin its two-day meeting on Tuesday, March 17 and announce its policy decision on Wednesday.
The central bank is widely expected to keep rates steady as US inflation remains above the Fed’s 2% target. The consumer price index rose 2.4% on a year-over-year basis in February, according to the latest Bureau of Labor Statistics.
3. US markets
Domestic markets will also take cues from Wall Street. Major US indexes ended lower on Friday. The Dow Jones Industrial Average closed down 119.38 points, or 0.26%, at 46,558.50. The Nasdaq composite lost 206.62 points, or 0.93%, to 22,105.40, while the S&P 500 lost 0.61%, or about 40 points, to end at 6,632.19.
4. Crude oil
All eyes will be on crude oil prices. Benchmark Brent and US WTI crude rose more than 3% in the previous session and could extend gains when trading resumes.
U.S. WTI crude futures settled at $99.31 a barrel, up $3.58, or 3.74%, while Brent crude rose 3.43%, or $3.41, to close at $103.14 a barrel.
5.. FII / DII action
Foreign institutional investors (FIIs) sold stocks worth INR 10,716.64 crore on Friday. Meanwhile domestic institutional investors (DIIs) were net buyers at Rs 9,977.42 crore.
FIIs have offloaded shares worth Rs 52,704 crore in the first week of March, with Friday recording the highest one-day inflow of 2026. Year-to-date, foreign portfolio investors (FPIs) have sold Indian equities worth Rs 66,051 crore.
6. Sector Monitoring
The Iran-Israel/US conflict has affected several sectors. Oil marketing companies (OMCs) may come under pressure if crude oil prices rise further, as higher fuel costs may reduce their margins. On the other hand, upstream explorers like ONGC and Oil India can benefit from higher oil prices.
Paint and tire companies, which use raw materials as raw materials, may face pressure. Airline and tourism stocks are expected to react when markets open. With LPG shortage already affecting restaurants, further correction in quick service restaurant (QSR) stocks cannot be ruled out.
7. Technical incentives
Decoding the Nifty charts, Dr Ravi Singh, Chief Research Officer, Master Capital Services, said the index has decisively broken its crucial 23,800 support and is now trading at a 10-month low, indicating a strong bearish grip.
For the next week, the psychological level of 23,000 will be very important. A break below that could push the index to 22,800 and even 22,500, he said.
He added: “On the upside, 23,800 and 24,050 are now acting as strong resistance levels. The strategy remains ‘short sell’ until the index decisively re-announces the 24,000 mark. Expect continued volatility as the market searches for a low amid Middle East tensions.”
8. Rupee against dollar
The movement of the rupee against the dollar will also be closely watched.
The Indian rupee fell to a record low on Friday amid concerns that war-driven oil prices with Iran could disrupt India’s growth-inflation dynamics and investment flows. The rupee weakened to 92.4750 per dollar, breaking Thursday’s previous record low of 92.3575.
It finally closed at 92.4550, down 0.7% for the week.
The benchmark Nifty 50 fell into correction territory after the US and Israel launched attacks on Iran on February 28, with the index down about 2% on Friday.
Analysts told Reuters that a protracted Middle East conflict could significantly worsen the rupee’s outlook, with persistently high energy prices potentially pushing the currency above 95 to the dollar.
9. IPO Watch
Activity in the primary market is expected to remain strong, with three IPOs opening for participation this week and three companies scheduled to list.
GSP crop science and Central Mine Planning and Design Institute (CMPDI) main board IPOs will be in focus.
Agrochemicals maker GSP Crop Science plans to raise Rs 400 crore through its public offering. The IPO will open on March 16 and close on March 18, with a price of Rs 304-320 per share.
CMPDI, the consulting arm of Coal India, will launch its IPO on March 20 and close on March 24. The gray market premium (GMP) is currently around Rs.24.
Meanwhile, the Novus Loyalty SME IPO will start on March 17 and end on March 20. The price band is set at Rs 139-146 per share, and the company aims to raise around Rs 60.15 crore.
Rajputana Stainless Stock, Apsys Aerocom and Rajmarg Infra Investment Trust are also slated to list on the exchanges this week.
(Disclaimer: The suggestions, recommendations, views and opinions given by the experts are their own. They do not represent the views of The Economic Times)
