Indian shares likely to rebound after selloff, but oil surge may cap gains
- GIFT Nifty futures were at 22,379.5
Indian shares are poised for a higher open, anticipating a technical rebound after a sharp selloff. However, surging oil prices and new US regulatory pressure on Indian IT firms could cap these gains.
- Factors driving the recent sharp selloff in Indian shares.
- Impact of surging oil prices and global bond yields.
- US regulatory pressure on Indian IT outsourcing firms.
Indian shares are poised for a higher open on Friday, with benchmark indexes likely to stage a technical rebound after a sharp selloff pushed them into oversold territory and to multi-year lows in the previous session.
Gains, however, could be capped by a surge in oil prices and fresh US regulatory pressure on a green-card programme widely used by Indian IT outsourcing firms.
GIFT Nifty futures were at 22,379.5 at 7:41 a.m. IST, indicating a positive start for the Nifty 50, which closed at 22,231.80 on Thursday.
The Sensex ended the previous session at a 32-month low, while the Nifty slipped to its lowest level in 18 months.
The selloff reflected mounting concerns over elevated crude prices, rising global bond yields and a weaker rupee. These factors have heightened inflation worries after the Reserve Bank of India’s hawkish rate increase earlier this week.
Foreign portfolio investors offloaded a net 129.44 billion rupees ($1.3 billion) of Indian equities on Thursday, marking their largest single-day outflow since May 29, 2026. Domestic institutional investors helped cushion the sales, purchasing a net 107.03 billion rupees of shares.
The decline has also driven the benchmarks toward an oversold territory, suggesting weak momentum but raising the prospect of a near-term technical bounce, analysts said.
Brent crude hovered near $104 a barrel after jumping 4% on Thursday, driven by escalating Middle East tensions and supply-disruption fears linked to a hurricane approaching the US Gulf Coast.
Any recovery, however, could be constrained by weakness in heavyweight IT stocks.
Tata Consultancy Services, the country’s top software company, reported its weakest September-quarter revenue growth in three years, heightening concerns about client spending and demand conditions for the sector.
Pressure intensified after the US suspended major IT outsourcing firms on Thursday from the Permanent Labor Certification Program, a key green-card pathway.
“Indian IT companies are already operating under pressure, and this additional regulatory development adds another layer of uncertainty,” said Sumit Singhania, head of research at Bajaj Broking.