Markets defy global gloom; crude tops $85

Benchmarks closed sharply higher on Friday, shrugging off weak global cues as buying in banking, IT, and financial heavyweights drove a broad-based rally. The gains came even as escalating conflict between the United States and Iran pushed Brent crude above $85 a barrel and gold wobbled near $4,000 an ounce, keeping inflation concerns alive globally.

The Nifty 50 rose 1.09 per cent, or 262 points, to settle at 24,334, while the Sensex advanced 1.25 per cent to close at 78,151. For the week, the Nifty ended 0.53 per cent higher, having found consistent support near the 24,000 level, its 20-day moving average. IT was the standout sectoral winner of the week, surging 4.2 per cent, lifted by better-than-expected results from Tech Mahindra. Private banks also gained on expectations that an RBI special overseas deposit scheme could pull in around $30 billion from NRIs, bolstering forex reserves. Pharma, metals, and realty were the week’s laggards. Broader markets underperformed Friday’s rally, with the Nifty Midcap 100 and Smallcap 100 declining 0.41 per cent and 0.21 per cent respectively, reflecting selective profit-booking outside the index heavyweights.

“Markets staged a strong advance on Friday and gained over a percent despite weak global cues...the Nifty closed near the day’s high,” said Ajit Mishra, SVP Research at Religare Broking.

On the currency front, the rupee traded largely flat at 96.26 against the dollar, gaining just around 4 paise on the day. Elevated crude prices and cautious foreign fund flows continue to weigh on the domestic currency, with the technical range pegged at 96.00–96.55.

In commodities, crude dominated the global narrative. Brent is on course for a weekly gain of over 10 per cent, with tanker traffic through the Strait of Hormuz at two-month lows after six consecutive nights of US strikes on Iranian military infrastructure. Tehran has reportedly asked Yemen’s Houthi faction to prepare to shut the Bab el-Mandeb strait if Iranian infrastructure faces further strikes, raising the spectre of two simultaneous chokepoint closures. “With the ceasefire effectively in name only and escalation risk building on both fronts, the geopolitical risk premium embedded in prices looks unlikely to unwind soon,” noted Kaynat Chainwala, AVP Commodity Research at Kotak Securities.

Gold, meanwhile, clawed back above $4,000 per ounce but remains down 3 per cent for the week. Silver is near its weakest since November 2025, off more than 10 per cent for the week. Fed commentary remained hawkish, with September rate hike odds on CME FedWatch rising to 53 per cent.

Looking ahead, investor attention next week will be firmly on earnings. Results from Reliance Industries, HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank over the weekend are expected to set the tone for the Financials sector and define the broader market direction early next week. Siddhartha Khemka of Motilal Oswal expects “a gradual uptrend” driven by the earnings season, though crude at elevated levels and rupee weakness remain key risks to watch.