The Indian equity markets witnessed a sharp correction on Friday, 27 March 2026, as the Nifty 50 plunged nearly 450 points (1.93%) to close around 22,856, while the Sensex tanked more than 1,500 points. The sell-off was primarily driven by escalating US-Iran geopolitical tensions and a spike in Brent crude prices toward $123 per barrel. Sentiment was further dampened by the Indian rupee breaching the 94 per USD mark and the government’s sudden mandate for an export tax on fuels. This led to a significant drag on heavyweights, with Reliance Industries sliding more than 4%. On the sectoral front, PSU Banks and Auto were the worst laggards, with the former cratering over 3%, while IT and Pharma showed relative resilience as defensive plays. The market breadth was overwhelmingly bearish, reflected in a skewed advance-decline ratio, with nearly 473 stocks hitting 52-week lows on the NSE.
Two stock recommendations by MarketSmith India:
Buy: Aurobindo Pharma Ltd (current price: ₹1,310)
Why it’s recommended: Strong presence in the US generics market, diversified product portfolio, robust R&D capabilities, improving margins and cost control, growth in the speciality and injectables segment, healthy balance sheet, consistent revenue growth, backward integration benefits, expanding global footprint, and regulatory compliance improvements.
Key metrics: P/E: 21.34 | 52-week high: ₹1,330.00 | Volume: ₹245.07 crore
Technical analysis: Cup-base breakout
Risk factors: The USFDA regulatory risks, pricing pressure in generics, high dependence on the US market, currency fluctuation impact, litigation and compliance risks, API business volatility, intense industry competition, delay in product approvals, margin pressure risk, and geopolitical and export risks.
Buy: ₹1,300-1,320
Target price: ₹1,450 in two to three months
Stop loss: ₹1,240
Buy: NLC India Ltd (current price: ₹270)
Why it’s recommended: Government-owned status with strong backing, integrated power and mining business, consistent profitability track record, expansion into renewable energy, large capex growth plans, stable cash flows due to utility nature, diversification into EV and storage, improving revenue growth trend, decent margins over cycles, and strategic importance in the energy sector.
Key metrics: P/E:13.46 | 52-week high: ₹292.20 | Volume: ₹67.59 crore
Technical analysis: Reclaimed its 21-DMA
Risk factors: High capex leading to cash flow pressure, dependence on lignite and thermal power, regulatory and environmental risks, long gestation project risks, possibility of increased debt, power tariff regulation risk, execution risk in expansion plans, uncertainty in renewable transition, commodity and fuel price risk, and PSU-related governance constraints.
Buy at: ₹268-271
Target price: ₹298 in two to three months
Stop loss: ₹256
Nifty 50: How the benchmark index performed on 27 March
Indian equities witnessed a sharp risk-off session on 27 March, with the Nifty 50 declining 2.09% (−486.85 points) to close at 22,819.60, breaching key near-term support levels and ending near the day’s low of 22,804.55. The sell-off was broad-based, reflected in weak market breadth, with decliners (2,814) significantly outpacing advancers (505), indicating widespread pressure across segments. On the sectoral front, PSU Banks, Realty, Auto, and Financial Services led the losses, each falling approximately 2-4%, while defensives such as IT and Pharma showed relatively better resilience with milder losses. Heavyweight financials and consumption stocks dragged the index lower, suggesting continued profit booking and cautious sentiment.
The Nifty 50 continues to exhibit a pronounced downtrend, with recent price action confirming sustained selling pressure and a breakdown below key moving averages. The index is trading decisively beneath all its key moving averages. Momentum indicators remain firmly negative. The RSI is trending around 35, reflecting weak momentum and staying below the neutral 50 mark, suggesting sellers remain in control without yet entering extreme oversold territory. Additionally, the MACD trades in negative territory, with a widening gap between the MACD and the signal line, highlighting increasing bearish momentum and a lack of reversal signals.
According to O’Neil’s methodology of market direction, the Indian equity market has transitioned from a “Downtrend” to a “Rally Attempt.
On the price front, immediate support for the Nifty 50 is placed near 22,600-22,400, with a breakdown below this level potentially leading to further downside. On the upside, resistance is seen around 23,500, followed by a stronger hurdle near 23,900, where key moving averages are clustered. Looking ahead, the index is expected to remain volatile with a slight positive bias in the near term, supported by short covering and improving sentiment.
How did the Nifty Bank perform on 27 March?
The Nifty Bank opened on a negative note at 53,244.25 and remained under sustained selling pressure throughout the session. After touching an intraday high of 53,292.50, the index saw sharp profit-taking at higher levels, declining steadily to an intraday low of 52,211.20. It eventually closed near the lower end at 52,274.60, down 2.67%, indicating strong bearish sentiment. The index has decisively breached key moving averages, including the 21- and 50-DMA, reflecting weakening trend structure. Continued distribution and lack of institutional support suggest that rallies are likely to face selling pressure, highlighting fragile market confidence.
From a momentum standpoint, RSI is currently placed around 33, well below the neutral 50 level, indicating weak momentum and nearing oversold territory without any confirmed reversal signal. Meanwhile, MACD remains deeply negative with a bearish crossover, and the histogram continues to expand on the downside, confirming strengthening bearish momentum. The alignment of both indicators suggests sustained downside pressure. Unless RSI stabilizes and MACD shows signs of convergence, any near-term bounce is likely to be corrective rather than indicative of a trend reversal.
Technically, immediate support for the index is seen near 52,000–51,800, with a critical breakdown level around 51,300. On the upside, resistance is placed near 54,100, followed by the 21-DMA around 56,000, which may act as a strong supply zone. Given the prevailing downtrend, persistent FII outflows, and weakness in financial stocks, the index is expected to remain under pressure in the near term. Any recovery is likely to face resistance at higher levels unless supported by improved market breadth, easing volatility, and renewed institutional buying interest.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O'Neil. You can access a 10-day free trial by registering on its website.
Trade name: William O’Neil India Pvt. Ltd.
Sebi Registration No.: INH000015543
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.