Nifty closed 0.32% higher last week, led mainly by IT stocks, with additional support from energy counters. As domestic markets reopen on Monday after the holiday-shortened break, a host of key events lined up through this week are likely to drive market sentiment.

On Friday, the 50-stock index edged lower by 64.60 points, or 0.27%, to close at 23,719.30.

Stock markets will remain closed on Thursday, May 28, on account of Bakri Eid.

Rupak De, Senior Technical Analyst at LKP Securities, said Nifty failed to close above the crucial 23,800 resistance level for the second consecutive session despite a positive RSI crossover, indicating lack of strong momentum. The chart shows neither a breakout nor a breakdown visible on the charts with Nifty in an indecisive range-bound trade over the last 4–5 sessions, he said.

“A decisive breakout from this range is essential for the next leg of rally or correction to unfold. On the downside, immediate support is placed at 23,600, below which the index may drift towards 23,400. A breach below 23,400 could trigger a sharper correction in the market. On the higher side, a decisive move above 23,800 may induce a fresh directional upward move in the short term,” De said.

Iran-Israel war
After a long lull, developments on the Iran-US negotiations stalemate, undercurrents are being felt with Iran’s top negotiator and Parliament Speaker Mohammad Bagher Qalibaf ‌meeting ⁠Pakistani ⁠Army Chief Asim Munir in Tehran as part of ongoing diplomatic ⁠efforts over ‌regional tensions, Iranian ⁠state media reported on Saturday.

Munir also held meetings with Iranian President Masoud Pezeshkian in ‌the presence of Foreign Minister Abbas ⁠Araqchi during his visit to Iran.US markets
Frontline indices on Wall Street closed in the green on Friday as treasury yields eased, lifting megacaps and chip stocks, though markets watched for signs of a breakthrough in discussions to end the Middle East war.

While Dow 30 ended at 50,579.70, gaining 294.04 points or 0.58%, the S&P 500 was 0.37% (27.75 points) higher at 7,473.47. The tech-heavy Nasdaq Composite was down by 50.87 points or 0.19%.

Bond yields
With inflation worries resurfacing, global investors are closely tracking movements in the bond market. The yield on the 30-year U.S. Treasury note surged to 5.201% on Wednesday — its highest level since 2007 — amid growing uncertainty over the outcome of the Middle East conflict, which has heightened fears of elevated energy prices and renewed inflationary pressures. The yield was last seen trading at 5.0795%.

Investor sentiment toward equities also weakened globally. U.S. equity funds witnessed outflows of $12.05 billion during the week, marking the second weekly withdrawal in the past three weeks. Asian equity funds too saw net outflows of $570 million, while European funds bucked the trend by attracting net inflows of $4.62 billion. Sectorally, technology funds continued to remain in favour for the seventh straight week, garnering net inflows of $6.94 billion. In contrast, financial and industrial sector funds saw investors pull out $2.8 billion and $1.3 billion, respectively.

Crude oil
Global benchmark crude oil prices will remain an important factor in determining the direction of domestic markets.

The US WTI crude oil futures ended at $97 per barrel on Friday, dropping $0.65 or 0.67% in a single session while Brent witnessed an uptick of 1.63% or $1.67 per barrel to close at $103.54.

FII/DII action
FII outflows have been one of the biggest spoilers of market sentiments and will be tracked when markets resume trading this week.

On Friday, FIIs sold domestic shares to the tune of Rs 4,440.47 crore while domestic institutional investors (DIIs) were net buyers at Rs 6,003.53 crore.

Foreign institutional investors (FIIs) have offloaded domestic equities worth Rs 2.22 lakh crore in 2026, remaining net sellers for the third successive month-to-date. They have sold shares worth Rs 30,374 crore, so far this month.

Read more: FIIs sell over Rs 30K crore worth of Indian equities in May as outflows swell to Rs 2.22 lakh crore. What lies ahead?

Technical triggers
Nilesh Jain, Vice President – Head of Technical and Derivative Research at Centrum Finverse said Nifty has formed a small bullish candle on the weekly chart. Encouragingly, the index managed to sustain above its 50-DMA, placed near 23,690, which is likely to act as an immediate support level, while the next crucial support is seen around 23,500, he said.

“On the upside, a decisive breakout above 23,800 is essential to trigger a fresh short-covering rally towards 24,000 and higher levels. The broader market structure continues to remain constructive and indicates a positive undertone. Going into the coming week, volatility is expected to remain elevated owing to the monthly F&O expiry. We expect the Nifty to trade within a broader range of 23,500–24,000 with a positive bias. The India VIX declined nearly 5% during the week and closed below the 18 mark. A further cooling-off in volatility would continue to support bullish sentiment in the market,” Jain said.

Rupee Vs dollar
The Indian rupee rallied to close above the 96-per-dollar mark for the first time in a week on Friday, helped by the central bank’s aggressive interventions to arrest the currency’s slide from 94.50 to nearly 97.

The rupee closed at 95.69 per dollar, up 0.5% from its close in the previous ‌session.

The Reserve ⁠Bank of ⁠India sold $2 billion to $3 billion on Thursday and intervened in the markets again on Friday, according to bankers.

Two state-run lenders were consistently selling dollars through Friday’s trading session, three traders told Reuters, adding that this marked a change from relatively subdued and intermittent activity in the earlier part of the week.

“It seems the RBI’s intends to draw some version of a line-in-the-sand for rupee weakness,” ⁠a senior ‌trader at a foreign bank said. The currency had weakened from 94.50 on May 8 to a record low of 96.96 ⁠on May 20.

State-run banks were spotted conducting dollar-rupee buy/sell swaps as well, most likely on behalf of the RBI, the bankers added. Dollar-rupee forward premiums fell as a result, with the 1-year implied yield down 6 basis points at 3.39%.

The central banks’ presence also ensured that the rupee was largely unfazed by a more than 2% rise in Brent crude prices to $105 per barrel on Friday as ‌investors doubted the prospect of a breakthrough in the U.S.-Iran talks.

Stocks in focus
Stocks of oil marketing companies (OMCs) will be in focus after petrol and diesel prices were hiked on Saturday for the third time in less than two weeks. The government said India had absorbed the impact of rising global oil prices for 76 days following the outbreak of the US-Iran conflict.

The cumulative increase is under Rs 5 per litre as on Saturday.

Select stocks will also be in focus because of corporate actions lined-up during the week.

Stocks like Havells India, Trident, LTM, Siyaram Silk Mills, Tata Consumer Products, Tata Consultancy Services, ITC, Torrent Pharmaceuticals, Bajaj Auto, UNO Minda and Bank of India will have record dates for their dividend.

Meanwhile, Zydus Lifesciences, CyberTech Systems and Software and Dhanuka Agritech will have record dates for buyback of shares.

Life Insurance Corporation of India will have a record date on Friday, May 29 for bonus issue.

(Inputs from agencies)

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

Foreign institutional investors (FIIs) have offloaded domestic equities worth Rs 2.06 lakh crore in 2026, remaining net sellers for the third successive month-to-date. They have sold shares worth Rs 14,231 crore, so far this month.

On Friday, FIIs sold domestic shares to the tune of Rs 4,110.60 crore while domestic institutional investors (DIIs) were net buyers at Rs 6,748.13 crore.

Despite DIIs throwing around their weight, benchmark indices ended with sharp cuts on Friday, recording their second successive decline amid significant selling in the financial stocks. While Nifty plunged 150.50 points or 0.62% to close at 24,176.15, the BSE Sensex settled at 77,328.19, down 516.33 points or 0.66%.

Commenting on the current trends, N. ArunaGiri, CEO at TrustLine Holdings said domestic markets continue to see FII selling despite a nearly $50 billion sell-off since September 2024 at a time when South Korea received nearly $4 billion and Taiwan around $5.5 billion in flows.

“India is still not getting its due share of emerging market allocations. This clearly indicates that FIIs currently do not find India as attractive from an allocation perspective. As a result, large caps have relatively underperformed, while strong domestic flows have continued to support the SMID segment. As long as FIIs do not meaningfully increase India allocations, the market is likely to remain highly stock-specific, driven by earnings visibility and bottom-up opportunities rather than momentum rally led by large caps,” ArunaGiri said.

Outlook

Bajaj Broking said institutional activity is expected to be largely driven by global developments, going forward. The progress or deterioration of the U.S.–Iran negotiations will remain a key factor to monitor, he said, outlining significant implications for geopolitical stability and the potential impact on crude oil price volatility.

FIIs in 2026

War-induced sell-off in March made it the worst month this year, witnessing an exodus worth Rs 1,17,775 crore. April was not kind too, with outflows of Rs 60,847 crore. Foreign investors turned net buyers in February, buying shares worth Rs 22,615 crore in the domestic markets so far. In January, they sold Rs 35,962 crore worth of shares.

In 2025, the FIIs buying trends remained patchy, but the overall trend was bearish. They took Rs 1,66,286 crore from Indian markets as trade deal delay and premium valuations weighed on the sentiments.

Also read: FII ownership hits 14-year low to 14.7%; DII cushions Indian markets with 18.9% rise: Report

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

Monitoring the investment activity of institutional heavyweights like Foreign Institutional Investors (FIIs) can be quite insightful, as their moves are typically backed by deep research and long-term conviction. Over the four quarters ending March 2026, foreign institutional investors steadily raised their holdings for four consecutive quarters in 49 stocks, each with a market capitalisation exceeding Rs 10,000 crore.

From a price performance perspective, 29 stocks have generated double-digit gains over the past one year. Of these, 13 rallied sharply between 60% and 352%, while 5 emerged as multibaggers, more than doubling investor wealth within a year. (Data source: ACE Equity)

Foreign institutional investors (FIIs) quietly increased their exposure to Suzlon Energy in the March quarter, even as they pulled out more than Rs 1 lakh crore from Indian equities during the same period. FIIs raised their stake in the renewable energy company by about 1.68 crore shares sequentially. Their holding stood at 3,07,46,15,640 shares, or 22.42%, at the end of the March quarter, compared with 3,06,32,23,175 shares, or 22.34%, in the December quarter.

The incremental buying comes at a time when Suzlon’s stock has corrected around 12% so far this year, following a sharp rally over the past two years that turned it into a multibagger after its turnaround phase.

The FII move stands out against the broader trend of foreign outflows, suggesting selective accumulation in companies where growth visibility remains intact despite near-term market volatility.

Operationally, Suzlon has delivered decent numbers in the recent past. The company reported a 15% year-on-year rise in consolidated profit to Rs 445 crore in the December quarter, while revenue jumped 42% to Rs 4,228 crore, reflecting robust execution and order conversion.

Street expectations remain strong heading into the March quarter. JM Financial estimates Suzlon could report a 51% year-on-year jump in revenue to Rs 5,708 crore, with EBITDA seen rising 54% to Rs 1,068 crore and net profit expected to grow 53% to Rs 888.8 crore.

Brokerage views also remain constructive on the longer-term outlook. Systematix highlights Suzlon’s leadership in India’s wind energy market with around 35% share in installations and a strong order book of 6.5 GW, which provides visibility for sustained growth. The company’s integrated model spanning manufacturing, EPC and operations and maintenance is seen supporting recurring revenue streams and margin expansion.

Suzlon’s improving balance sheet is another key positive. After years of high leverage, the company has strengthened its financial profile through deleveraging and better working capital management, enabling it to bid for larger renewable energy projects.With India accelerating its renewable energy push, particularly in wind capacity addition, Suzlon remains well placed to benefit from sector tailwinds. The recent FII buying, despite broader market selling, suggests institutional investors may be positioning for that next phase of growth.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

Foreign investors have been incessantly selling Indian equities since the beginning of March, following the outbreak of the raging war between Iran and US. Analysts have suggested key factors that led to the sustained FII outflows, where it was heading towards, and what is needed to bring them back to Dalal Street.

Foreign investors net sold Indian equities worth Rs 1.6 lakh crore for 25 consecutive sessions between March 2 to April 9. In fact, the selling streak overall continued for 27 consecutive sessions, starting from the end of February. The sustained selloff was one of the major factors behind the massive bear attack on Dalal Street that wiped off massive sums of investor wealth in March, as Sensex and Nifty crashed over 11% during the month while oil prices soared following the effective closure of the Strait of Hormuz.

April began with new hopes as ceasefire talks uplifted sentiment on Dalal Street. Sensex and Nifty have gained over 6% each over the last week. Yet, foreign investors were cautious. In the first two sessions of April, they net sold Indian shares worth more than Rs 18,260 crore. Last week, they sold Indian equities worth over Rs 21,380 crore between Monday and Thursday.

However, foreign investors remained net buyers of Indian equities on Friday, breaking a 27-session-long selling streak and bringing much-needed relief. FII net bought Indian shares worth Rs 672 crore on April 10, according to data on NSE. Only time will now tell whether this reflects a long-term change in FII’s behavior or a brief U-turn.

Meanwhile, analysts have advised caution. “After the record Rs 1,22,182 crore selling in March, FPIs continued selling in April, too. Up to 11th April, total FPI selling through the exchanges stood at Rs 48,905 crores, taking the total FPI selling for 2026, till now, to Rs 1,90,046 crore,” said VK Vijayakumar, Chief Investment Strategist at Geojit Investments.

South Korea and Taiwan looking more attractive than Indian markets

The energy crisis triggered by the conflict in West Asia, the potential impact of the crisis on Indian economy and sustained depreciation of the rupee kept the FPIs on sell mode, the analysts noted. “Other markets like South Korea and Taiwan are considered more attractive from the FPI perspective since these markets are expected to deliver much superior earnings growth when compared to the modest earnings growth expected in India in FY27,” he added.The sharp correction in the market after the war began has made the valuations fair, but not compelling buys, yet, according to Vijayakumar.

“The surge in equity mutual flows to Rs 40450 crores and monthly SIP inflows to Rs 32087 crores in March bode well for the market. With such strong mutual fund flows into the market, FPI selling will not impact the market significantly,” he however noted.

What will turn foreign investors buyers again?

However, FPIs turning buyers in the market will depend on the situation in West Asia and crude prices, according to him. “If there is de-escalation in the conflict and crude declines significantly, India’s macros will not be impacted materially. If the conflict prolongs India’s macros will be impacted. It would be unrealistic to expect FPIs to turn buyers in such a scenario,” he concluded.

JM Financial noted that foreign investors were net sellers of Indian equities worth $13.6 billion in March. Over the last 12 months, Indian primary markets saw FII net inflows of Rs 70,800 crore whereas secondary markets logged FII net outflows of Rs 2,66,400 crore, it further said, adding that BFSI, auto, telecom, FMCG, realty, pharma and oil & gas saw the biggest FII outflows, while capital goods was the only sector that saw inflows in March.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)