India Market Lens

Indian equities ended a holiday-shortened week lower, extending their weekly losing run to eight weeks. Persistent foreign selling, elevated oil prices and higher global bond yields were the main pressures cited by market participants. For India, the combination raises concern about imported inflation, the rupee and the cost of capital; it also leaves the market more exposed to any further deterioration in global risk appetite.

Autos were a clear source of stock-specific pressure after September sales disclosures disappointed in parts of the sector. Bajaj Auto reported total sales of 5.38 lakh units, up 5% year-on-year, but below the 5.79 lakh-unit estimate cited by CNBC-TV18; domestic sales fell 9% year-on-year. Mahindra & Mahindra reported 1.15 lakh vehicle sales, below the cited 1.17 lakh estimate, while its tractor sales fell 21% year-on-year to 52,100 units, also below market estimates. Reports linked the pressure on these shares to the shortfall against expectations and the weak domestic and farm-equipment readings. Maruti Suzuki’s September sales, by contrast, exceeded the cited poll estimate, but this did not prevent broader weakness across autos.

IT shares provided a counterweight. Infosys and TCS were among the gainers as traders looked to Accenture’s results for evidence on technology-services demand. Banks were comparatively resilient, with HDFC Bank and Kotak Mahindra Bank among the shares that advanced on the final session. The weakness in power and infrastructure stocks sat within a wider risk-off backdrop of higher yields, costly energy and foreign outflows; a separate company-specific trigger for those groups was not available in the reporting reviewed.

The Reserve Bank of India’s October policy meeting was ahead of the market, not a decision already taken. In a Reuters poll, 35 of 61 economists expected a 25-basis-point increase in the repo rate to 5.50% at the October 5–7 meeting, citing broadening inflation and higher energy costs. That is a survey of expectations, not RBI guidance. If rates rise, higher borrowing costs could add to pressure on rate-sensitive businesses and government financing.

The RBI also finalised rules allowing eligible mutual funds, insurers and pension funds to seek one-time approval for subsequent acquisitions of up to 10% of a bank. The change removes the need for repeated approvals for qualifying holdings, subject to the regulator’s conditions. SEBI chairman Tuhin Kanta Pandey said overseas remittance limits remain a matter for the RBI and must comply with the Liberalised Remittance Scheme and FEMA rules; SEBI’s new portfolio-manager regulations permit specified overseas investments subject to those rules.

US equities were mixed on Thursday as softer inflation data supported shares, while Treasury yields remained elevated after a sharp rise earlier in the session. The US 10-year yield touched 5.34% intraday, its highest level since 2002, before easing. Higher US yields can make dollar assets more attractive relative to emerging-market securities; market participants linked that global backdrop, alongside sustained foreign selling, to pressure on Indian equities.

Asian markets were mixed, with shares outside Japan down for the week while Japan’s Nikkei rose. Foreign portfolio investors were net sellers of Indian equities on October 1, selling Rs 9,484 crore, while domestic institutions bought Rs 10,042 crore, according to provisional cash-market data. These are daily flows, not a full-week total. The rupee’s decline and elevated crude added to concerns about India’s import bill and corporate costs.

August industrial production grew 8.0% year-on-year, up from revised growth of 7.4% in July, according to data released by the National Statistics Office. Manufacturing output rose 9.0% year-on-year and electricity and gas supply rose 12.3%. The release offered evidence of stronger factory activity, though it did not remove the market’s concerns about energy costs and financing conditions.

September gross GST collections rose 14.7% year-on-year to Rs 2.04 lakh crore, according to provisional government data. Domestic collections increased 10.1%, while import collections rose 25.9%; the faster import growth means the headline advance was not solely a domestic-demand signal. HSBC’s September manufacturing PMI was 55.1, up from 52.8 in August but below its flash estimate of 55.7. September CPI was not released during the week; the official release calendar set October 12 for that print.

Accenture reported fourth-quarter revenue of $18.68 billion, up 6% year-on-year in US dollars and above analysts’ $18.03 billion estimate as well as the top of its own guidance range. It forecast fiscal 2027 local-currency revenue growth of 3% to 6%. The result was a positive read-through for Indian IT services, but one overseas company’s performance is not a substitute for Indian companies’ own quarterly results.

Marine Electricals said it had received orders totalling Rs 250.78 crore for power-distribution systems. No market-consensus comparison for the order was available.

The primary market remained active even as secondary-market sentiment weakened. Moneyview and A-One Steels India began trading on October 1; their first-session premiums showed demand for those individual offerings, but do not establish that broader equity risk appetite had improved. The market’s near-term attention now turns to the RBI decision and the start of September-quarter earnings, including TCS’s scheduled results consideration on October 8.