Nifty set for cautious open as Middle East tensions lift oil prices
GIFT Nifty:
GIFT Nifty September 2026 futures fell 11 points, indicating a cautious start for the Nifty 50.
SEBI has eased compliance requirements for foreign portfolio investors (FPIs) investing exclusively in Indian government securities. Such FPIs will no longer be required to disclose details of their investor group, irrespective of whether they invest through the Fully Accessible Route or General Route. The move follows the RBI's decision to remove concentration limits for FPIs investing in government securities through the General Route and is aimed at reducing compliance burdens and facilitating greater foreign participation in India's government bond market.
Institutional Flows:
Foreign portfolio investors (FPIs) bought shares worth Rs 280.13 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 566.76 crore in the Indian equity market on 7 September 2026, according to provisional data.
FPIs sold shares worth Rs 15116.06 crore in September so far, through 7 September 2026. This follows net cash purchases of Rs 17,366 crore in August 2026, while they were net buyers of Rs 6,731.97 crore in July 2026.
Global Markets:
The US stock market was set for a cautious reopening on Tuesday after the Labor Day holiday, with Dow futures down about 323 points amid heightened Middle East tensions.
Most Asian markets advanced, but gains were tempered by concerns over rising oil prices. Brent crude climbed above $97 a barrel as tensions around the Strait of Hormuz intensified following US-Iran military confrontations. Iran has threatened tighter controls around the strategic waterway, raising concerns over possible disruptions to global oil supplies.
The rise in crude has also strengthened inflation concerns and complicated the Federal Reserve's policy outlook. Markets are pricing in more than a 60% probability of a 25-basis-point Fed rate hike at the September meeting. US inflation data due later this week could influence those expectations.
Investors are also watching renewed US-Canada trade tensions. Canada is set to impose retaliatory tariffs on around $20 billion of US goods, while President Donald Trump has threatened to block Bombardier from selling aircraft in the US unless the company manufactures them domestically.
Domestic Market:
The key equity indices ended with modest losses on Monday, driven by escalating US-Iran tensions and firm crude oil prices. Strong US jobs data also revived expectations of a September Federal Reserve rate hike, while rising US bond yields added pressure on emerging-market equities. Persistent foreign institutional investor selling further weakened sentiment. The market is also facing liquidity pressure from a strong IPO pipeline, with several large issues expected to absorb funds from the secondary market. The Nifty closed below the 23,800 level, dragged by IT and metal shares. However, pharma and consumer durables shares were in demand. The S&P BSE Sensex declined 382.62 points or 0.50% to 76,132.81. The Nifty 50 index lost 118.55 points or 0.50% to 23,779.15.
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