Indian equity benchmarks muted as elevated oil, Fed in focus

Indian equity benchmarks ended little changed on Tuesday as elevated oil prices kept sentiments cautious, with investors awaiting the Federal Reserve’s policy decision later this week.

The Nifty 50 fell 0.02% to 22,749.75, and the Sensex shed 0.01% to 73,598.67.

Brent crude traded near $116 per barrel, close to six-month high levels, as attacks on Saudi Arabia dampened hopes of an immediate easing of regional tensions.

India’s broader small-caps and mid-caps rose 2.7% and 1%, respectively.

Gains there were driven by a post-earnings jump in Sona, Ather Energy and Mankind Pharma, and buying in defence stocks after the acquisition panel’s clearance of over $22 billion worth of proposals.

Twelve of the 16 major sectors logged gains.

Investors’ focus this week is on the Fed, which is expected to keep rates steady on Wednesday, before resuming its tightening cycle in December as inflation worries loom.

“A hawkish stance could keep global financial conditions tight, weigh on emerging-market flows and create near-term volatility,” said Thomas Priju, portfolio manager at Karma Capital.

The Nifty 50 has lost about 13% so far in 2026, on course for its worst performance in over a decade as soaring crude oil prices fueled by the Middle East war and a lack of large AI exposure have propelled record foreign outflows.

As the world’s third-largest crude oil importer, India is particularly vulnerable to higher oil prices, which intensify inflationary pressures, strain the fiscal balance, and squeeze corporate profitability.

Heavyweight financials and information technology stocks fell 0.6% and 0.3%, while auto and pharma stocks rose 1.5% and 1.9%.

Tata Consumer Products rose 6.8% after reporting better-than-expected second-quarter profit, helped by steady demand for its packaged foods and beverages as the company expands beyond traditional tea and salt businesses.