Stock-market recap: Indian equities fell sharply on Wednesday as a fresh escalation in the US-Iran conflict sent crude oil prices surging, reviving inflation and rate-hike worries across global markets. The Nifty 50 dropped 141.35 points, or 0.59%, to close at 23,914.45, while the Sensex lost 373.93 points, or 0.49%, to settle at 76,570.35.
Stock-market recap: Indian equities fell sharply on Wednesday as a fresh escalation in the US-Iran conflict sent crude oil prices surging, reviving inflation and rate-hike worries across global markets. The Nifty 50 dropped 141.35 points, or 0.59%, to close at 23,914.45, while the Sensex lost 373.93 points, or 0.49%, to settle at 76,570.35.
The sell-off was broad-based, with Brent crude nearing $96 per barrel after the US carried out fresh strikes on Iranian targets, and Iran responded with missile and drone attacks, stoking fears over energy-supply disruptions through the Strait of Hormuz.
The sell-off was broad-based, with Brent crude nearing $96 per barrel after the US carried out fresh strikes on Iranian targets, and Iran responded with missile and drone attacks, stoking fears over energy-supply disruptions through the Strait of Hormuz.
Auto stocks bore the brunt of the selling, with the sector falling nearly 1.8% as Eicher Motors and Hero MotoCorp declined sharply on rising input costs and weaker exports. Airlines and Tyre manufacturing also came under pressure. IT and capital goods extended losses on a global bond-yield spike, while banking held up relatively better. Coal India bucked the trend, rising around 4% on strong demand and IPO-linked sentiment. Market breadth stayed weak, with 1,445 stocks advancing, 2,073 stocks declining, and 112 remaining unchanged.
Investors will track crude prices and geopolitical developments for near-term cues, even as resilient domestic GDP growth continues to offer some cushion.
Two stock recommendations by MarketSmith India:
Buy: Kirloskar Oil Engines Ltd (current price: ₹2,160)
Why it’s recommended: High-horsepower and data centre traction: Strong demand acceleration in high-horsepower (HHP) power-generation setups, specifically driven by a massive rollout of domestic data centres and critical infra contracts. Emission Norms Transition: Market-share expansion following successful engineering realignments for stringent CPCB IV+ and CEV BS-V domestic emission compliance upgrades.
Key metrics: P/E: 55.62 | 52-week high: ₹2,720.00 | Volume: ₹107.07 crore
Technical analysis: Tight range breakout
Risk factors: End-User Cyclicality: Heavy financial dependence on capital expenditure cycles across volatile user sectors like construction, farming, and mining. Export Friction: Vulnerability to margin headwinds from geopolitical roadblocks and slowing industrial activity in overseas markets.
Buy: ₹2,138–2,171
Target price: ₹2,350 in two to three months
Stop loss: ₹2,080
Buy: SKF India (Industrial) Ltd (current price: ₹3,030)
Why it’s recommended: Focused Core Capex Tailwinds: Substantial core growth momentum captured within standalone high-growth sectors, particularly wind energy, railways, and steel infrastructure. Demerger Strategic Agility: Enhanced capital allocation flexibility following its industrial business spin-off, supported by aggressive localization and a ₹800–950 crore expansion pipeline.
Key metrics: P/E: NA | 52-week high: ₹3,082.90 | Volume: ₹23.84 crore
Technical analysis: Trendline Breakout
Risk factors: Input-Cost Margin Pressures: Subdued near-term profitability and compressed operating margins driven by elevated raw material costs that run ahead of top-line expansion. Chinese & Domestic Competition: Rising price undercutting and fierce competitive intensity from low-cost Chinese imports and generic domestic bearing producers.
Buy at: ₹3,000-3,045
Target price: ₹3,450 in two to three months
Stop loss: ₹2,850
Nifty 50: How the benchmark index performed on 2 September
Indian equities ended lower on 2 September amid risk-off global cues, with Nifty 50 closing at 23,914.45, down 141.35 points or 0.59%, after recovering from an intraday low of 23,786.80. The Sensex also remained under pressure, as escalating US-Iran tensions, higher crude oil prices and rising global bond yields weighed on sentiment.
On the sectoral front, weakness was led by auto (-1.79%), media (-1.75%) and IT (-1.25%). Meanwhile, Oil and Gas (+0.33%), Realty (+0.21%), and PSU Banks (+0.07%) provided limited support.
Auto counters were particularly weak, with Eicher Motors and Hero MotoCorp among the notable laggards, while Coal India and ONGC benefited from strength in energy-related names. Market breadth remained negative, with 1,445 stocks advancing, 2,073 stocks declining, and 112 remaining unchanged, translating into an advance-decline ratio of roughly 0.70, indicating broader selling pressure.
During the session, the index briefly breached both its rising trendline and the 100-DMA. but recovered to close above them, suggesting that the broader uptrend remains intact for now despite increasing selling pressure. However, the index continues to trade below its shorter-term moving averages, reflecting a loss of momentum following the recent decline.
Although it is still comfortably above oversold territory, the RSI has slipped to 43 and remains below its signal average of 47, indicating weakening momentum. Meanwhile, the MACD remains in negative territory, with the MACD line below the signal line and a negative histogram, reinforcing the cautious short-term setup.
The Nifty 50 has breached its 100-DMA and the rising trendline, indicating a deterioration in the near-term technical structure. On the downside, a decisive break below 23,800-23,750 could reinforce bearish momentum and extend the corrective move towards 23,650-23,500. Conversely, any recovery is likely to encounter initial resistance around the 100-DMA and 24,000, making this a key hurdle for the index. A sustained close above 24,000 would signal improving short-term momentum and could trigger a broader recovery toward 24,400.
How did Nifty Bank perform yesterday?
The Nifty Bank opened on a negative note at 57,006.45 and, after briefly advancing to 57,221.10, came under renewed selling pressure. The index fell to an intraday low of 56,823.20 before recovering and closing at 57,177.00, down 237.60 points or 0.41%. Despite the negative headline close, the finish above the opening level produced a small bullish candle with a lower shadow, indicating some demand near 56,800.
However, the index remained below its 21- (57,590), 50- (57,615.76), and 200-DMA (57,442.32), while staying above the rising 100-DMA (56,497.50). The rejection near 57,220 and failure to reclaim the clustered averages keep the near-term structure range-bound with a mild negative bias.
Although it remains above oversold territory, RSI declined to 45.49 and remains below its average of 50.29, signaling weakening momentum and limited bullish conviction. MACD stayed below its signal line, with the MACD line at 12.92 versus the signal line at 48.79 and a negative histogram of 35.88, confirming a bearish crossover and subdued momentum. Nevertheless, both lines remain near the zero axis, indicating trend weakness rather than a decisive breakdown. A sustained RSI move above 50, accompanied by a bullish MACD crossover, would be required to strengthen the recovery case and improve the probability of an upside breakout.
Immediate support is placed at 56,800, followed by the 100-DMA near 56,500. A close below 56,500 could expose 56,000–55,800, while resistance is located at 57,440–57,620, where the 200-, 21-, and 50-DMAs converge. A decisive close above 57,620 may revive upside toward 58,000–58,300. For now, the index may remain volatile and range-bound between 56,500 and 57,620. Abundant banking-system liquidity offers domestic support, but rising global bond yields, elevated crude oil prices and geopolitical uncertainty could restrain risk appetite. Therefore, a directional move may emerge only after the index closes outside this range with stronger breadth and volume.
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