Markets track Iran-US tensions, India-EU trade deal amid key global developments
NSE data showed that FIIs/FPIs sold shares worth Rs 4,113.38 crore in the previous session. In contrast, domestic institutional investors (DIIs) provided support, buying equities worth Rs 4,102.56 crore.
- Jan 26, 2026,
- Updated Jan 26, 2026 1:57 PM IST
Indian equity benchmarks declined on Friday after a single-day pause, with the 30-share BSE Sensex pack and the NSE Nifty index slipping nearly 1 per cent, each. The sell-off was broad-based, extending beyond frontline indices, as mid-cap and small-cap stocks also came under heavy pressure, losing up to 1.85 per cent.
Looking ahead, market participants largely remained cautious amid global uncertainties. "Markets are closely watching how the Iran-US conflict is going to flare up in the coming days and also its impact on global crude oil prices. With that being said, the India-European Union (EU) trade deal would act as a positive sentiment booster for both foreign portfolio investors (FPIs) and domestic players. The India-EU trade deal is going to send positive signals to the Indian market," said Kranthi Bathini, Director – Equity Strategy at WealthMills Securities.
Last week saw sustained selling pressure, with bears dominating trade, according to Ajit Mishra – SVP, Research at Religare Broking. "Weak global cues, persistent foreign institutional investor (FII) outflows, a depreciating rupee and subdued corporate earnings kept pressure elevated throughout the week. Broader markets underperformed the benchmarks, highlighting heightened risk aversion and aggressive unwinding of high-beta positions," he said.
NSE data showed that FIIs/FPIs sold shares worth Rs 4,113.38 crore in the previous session. In contrast, domestic institutional investors (DIIs) provided support, buying equities worth Rs 4,102.56 crore.
Mishra noted that global developments continued to drive sentiment. "Sentiment was largely shaped by global developments, particularly rising tensions between the US and its European allies over Greenland, which added to trade and geopolitical uncertainty despite a relatively conciliatory tone from former US President Donald Trump. Continued FII selling remained a major drag on markets, while currency weakness further eroded confidence as the rupee slipped to the 92 level against the US dollar. On the earnings front, the absence of any meaningful positive surprises added to the cautious tone and dragged indices lower," he said.
"The coming week is packed with important domestic and global triggers. On the domestic front, markets will track industrial production data, government budget-related fiscal indicators, and weekly foreign exchange reserves. Globally, attention will remain on key US macroeconomic releases and, more importantly, the US Federal Reserve's interest rate decision, along with ongoing developments in global trade policies and central bank commentary," Mishra added.
From a technical standpoint, he said the 24,750–24,900 zone is a critical support area for Nifty, while the 25,300–25,400 range could limit any near-term upside.
Meanwhile, Indian equity benchmarks remained closed on Monday to mark Republic Day. Trading will resume on Tuesday at regular hours.
Indian equity benchmarks declined on Friday after a single-day pause, with the 30-share BSE Sensex pack and the NSE Nifty index slipping nearly 1 per cent, each. The sell-off was broad-based, extending beyond frontline indices, as mid-cap and small-cap stocks also came under heavy pressure, losing up to 1.85 per cent.
Looking ahead, market participants largely remained cautious amid global uncertainties. "Markets are closely watching how the Iran-US conflict is going to flare up in the coming days and also its impact on global crude oil prices. With that being said, the India-European Union (EU) trade deal would act as a positive sentiment booster for both foreign portfolio investors (FPIs) and domestic players. The India-EU trade deal is going to send positive signals to the Indian market," said Kranthi Bathini, Director – Equity Strategy at WealthMills Securities.
Last week saw sustained selling pressure, with bears dominating trade, according to Ajit Mishra – SVP, Research at Religare Broking. "Weak global cues, persistent foreign institutional investor (FII) outflows, a depreciating rupee and subdued corporate earnings kept pressure elevated throughout the week. Broader markets underperformed the benchmarks, highlighting heightened risk aversion and aggressive unwinding of high-beta positions," he said.
NSE data showed that FIIs/FPIs sold shares worth Rs 4,113.38 crore in the previous session. In contrast, domestic institutional investors (DIIs) provided support, buying equities worth Rs 4,102.56 crore.
Mishra noted that global developments continued to drive sentiment. "Sentiment was largely shaped by global developments, particularly rising tensions between the US and its European allies over Greenland, which added to trade and geopolitical uncertainty despite a relatively conciliatory tone from former US President Donald Trump. Continued FII selling remained a major drag on markets, while currency weakness further eroded confidence as the rupee slipped to the 92 level against the US dollar. On the earnings front, the absence of any meaningful positive surprises added to the cautious tone and dragged indices lower," he said.
"The coming week is packed with important domestic and global triggers. On the domestic front, markets will track industrial production data, government budget-related fiscal indicators, and weekly foreign exchange reserves. Globally, attention will remain on key US macroeconomic releases and, more importantly, the US Federal Reserve's interest rate decision, along with ongoing developments in global trade policies and central bank commentary," Mishra added.
From a technical standpoint, he said the 24,750–24,900 zone is a critical support area for Nifty, while the 25,300–25,400 range could limit any near-term upside.
Meanwhile, Indian equity benchmarks remained closed on Monday to mark Republic Day. Trading will resume on Tuesday at regular hours.