Indian equities face ongoing volatility driven by crude oil prices and geopolitical tensions, prompting focus on defensive sectors like IT and banks amidst a debate over future value opportunities.
Indian equities are still being pulled in opposite directions, with higher crude prices and geopolitical strain undercutting sentiment even as information technology shares provide some support. In a Business Today interview published on August 10, Asit Bhandarkar, senior fund manager, equity, at JM Financial AMC, set out his view on small-cap stocks, banks, financials, consumption and valuations as investors look for the next phase of the market. The discussion comes after analysts told Business Standard that the broader outlook for FY27 remains structurally constructive once oil prices and global tensions ease. (businesstoday.in)
The near-term market tone remains dominated by oil, foreign flows and the earnings cycle. Reuters-style market coverage from Rediff has repeatedly flagged the US-Iran conflict, Brent crude and quarterly results as the main triggers for domestic shares, while also noting that monsoon progress and inflation readings matter for rural demand and food prices. That backdrop helps explain why investors are still favouring sectors seen as relatively insulated from energy shocks, including IT services, even as cyclical names face sharper swings. (rediff.com)
Several analysts now argue that the recent weakness is more a function of external shocks than a deterioration in India’s corporate story. Business Standard reported in March that the BSE benchmark had fallen 7% in FY26, with foreign investors withdrawing over Rs 1 lakh crore in one month as West Asia tensions intensified and the rupee softened. The same report said a recovery in FII interest would depend on a clear de-escalation in the region, a cooling of Brent and greater currency stability. (business-standard.com)
Even so, the market has shown it can still find pockets of strength. Mint reported on July 19 that the Nifty 50 rose 0.53% for the week to close at 24,334.30 and the Sensex gained 0.75% to 78,151.45, helped by better-than-expected Q1 FY27 earnings from IT companies and fresh buying in financials. That pattern reinforces the current debate around where value now lies: in defensives such as IT and banks, or in beaten-down small caps if valuations become more attractive and the crude backdrop improves. (livemint.com)
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