Weekly Market Impact — for the week ending 02nd October 2026

Weekly Capsule (Sep 28 – Oct 02) and Impact Analysis

India’s fiscal deficit as of August 2026 comes in at 41.9% of full-year target

• What is a matter of concern for the government is that revenue flows have been less than 30% of full-year estimates
• This raises serious questions over whether India can defend the fiscal deficit at 4.3% of GDP for the full fiscal year FY27

RBI approves Anup Bagchi as Managing Director and CEO of HDFC Bank

• Anup officially takes charge on 27-October 2026, and the biggest challenge for him will be restoring its public image
• Anup Bagchi and Kaizad Bharucha were the contenders for the top job; and RBI seems to have gone for external candidate

Market consensus hints at RBI MPC hiking rates by 25 bps in October meet

• With consumer inflation at 4.82% and Brent Crude above $100/bbl, a 25-bps rate hike seems to be almost inevitable
• With the Fed having already cut rates by 25-bps, the RBI also runs the risk of monetary divergence and more FPI outflows

Hospital stocks came under pressure in the week after Supreme Court red flag

• Supreme Court raised concerns over the big gap between MRP and price to retailer; at times almost 10 times higher
• Supreme Court wants all essential drugs to follow the 16% ROI formula suggested by DPCO, to keep drug prices affordable

Tata Trusts seek to convert Tata Sons into an operating company once again

• This is like the pre-2004 situation when TCS was a division of Tata Sons, and hence NBFC/CIC rules did not apply to them
• Tata Electronics and Tata Consulting Engineers will become divisions of Tata Sons; doing away with listing requirements

The overhang of insurance distribution commissions continued this week too

• PB Fintech and Turtlemint, two highly impacted stocks, are now down about 40-45% from their yearly high prices
• Last week, IRDAI had proposed drastic cuts in upfront and trail commissions on life and health insurance to boost penetration

Indian thermal power units face a sharp coal supply crunch in this year too

• According to a CEA report, 77 out of the 190 thermal power plants were operating at critical levels of coal stock availability
• While hydro output is down -12% yoy, the power demand has gone up by 8% to a level of 5,381 million units per day

India needs to invest ₹4,00,000 crore in green energy storage by year 2032

• The operational RE storage needs to increase from the current level of 54 GWh to 411 GWh by year 2032 to be meaningful
• This includes battery energy storage systems (BESS) as well as pumped storage plants (PSP) to integrate RE into the grid

Brent crude prices tapered to $102/bbl, but stayed about the $100/bbl mark

• The boost came after Saudi Arabia restored supply lines via the East West pipeline, landing at Yanbu port on the Red Sea
• In addition, signals that Iran and the US may be moving towards the negotiation table also mellowed oil price worries

IIP grew 8.0% in August 2026, led by 9.0% growth in manufacturing IIP

• The July IIP also got revised up by 70 bps to 7.4%, holding the average IIP growth over the last 3 months at over 8.0%
• However, mining output dipped further into contraction mode across all minerals, except for a robust show by rare earths

Weak rural demand pulls down FMCG volumes by 2% in FY27 second quarter

• With urban demand growing 0.1% and rural demand falling by -5.0%, it seems that weak monsoons have done the damage
• The volume shrinkage was also broad-based, with nearly 68% of the FMCG categories showing contraction in volumes

Nifty and Sensex log longest 8-week losing streak in 25 years; last in 2001

• The NSE Nifty fell to its lowest closing level in six months, while BSE Sensex fell to its lowest closing level in 28 months
• Weakness in recent weeks was accentuated by rising oil prices, weak rupee, FPI outflows and the Middle East turmoil

US secondary sanctions on Russia could spike India oil bill by $7 billion a month

• The additional cost is estimated at $3.5 billion for 1 million barrels; as India imports nearly 1.9 million barrels from Russia
• The actual cost for India may be much lower as the Russian discounts to global prices have also substantially narrowed

US equity Shiller P/E ratio crosses the 40 mark; only second time in history

• Shiller P/E ratio or the CAPE ratio recalculates the P/E by looking at the inflation adjusted earnings of US companies
• The last time the US Shiller ratio had crossed above 40X, was at the peak of the tech boom in 2001; just preceding the crash

For September 2026, FPIs were net sellers in equities worth $3.75 billion

• This is despite $1.01 billion coming via IPO inflows in the month, as secondary market selling stood at $4.76 billion
• In addition, FPIs also sold Indian debt worth $2.36 billion, resulting in overall FPI selling of $6.11 billion in September

Spot Gold fell to $4,155/oz, while Spot silver also trended lower to $60.69/oz

• With one more rate hike expected by the Fed in December; gold and silver saw a spike in the opportunity cost of holding
• Central bank buying has eased and even investment demand for gold ETFs has come down sharply at a global level

Indian rupee weakens to ₹96.49/$ as the RBI raised its support band level

• Amid rising oil prices and higher US bond yields, the USDINR firmly settled above the ₹96/$ level on reduced RBI support
• The pressure on the rupee also came from RBI’s forward dollar liabilities touching a record level of $200 billion

Vedanta Copper is planning a capex of $2.3 billion to restart Tamil Nadu plant

• Vedanta Copper plans to produce about one million tonnes of copper; spread between Tamil Nadu and Saudi Arabia
• This includes restarting the Tuticorin copper smelter, which has been lying shut since 2018 over environmental issues

IPO bound Carlsberg India gets SEBI approval after confidential filing

• Carlsberg of Denmark, which entered India in the year 2007, has not yet disclosed the granular details of the IPO issue
• The next step is for Carlsberg India to file an updated draft red herring prospectus (UDRHP) with the actual details of the IPO

September sees growth in PV and CV sales; tractors hit by weak farm output

• Among PV / 2W makers; growth came from Maruti Suzuki (24%), TAMO (15%), M&M (14%), Hyundai (11%), Bajaj (5%)
• In tractors; M&M saw sales contracting -21%, while Escorts Kubota saw -17% fall in sales in month of September 2026

A total of 96 IPOs raise ₹1,12,983 crore in the first 9 months of calendar 2026

• The third quarter ended September 2026 accounted for 80% of the IPO collections; led by NSE, SBI MF, and Manipal Health
• Ironically, this enthusiasm in the IPO market comes at a time when Nifty is down -9.72% yoy and down -14.25% YTD