Weekly Market Impact — for the week ended 31st July 2026

Weekly Capsule (Jul 27 – Jul 31) and Impact Analysis

Fiscal deficit as of June 2026 came in at ₹3.08 trillion; 18.2% of full-year target

• This is despite the benefits of the RBI dividend in May and the advance tax receipts in the month of June 2026
• Full year target at 4.3% of GDP looks achievable, but subsidy burden could spiral if the war in the Middle East continues

IIP grew for the third month in a row in June 2026 at a higher level of 7.30%

• IIP has also benefited from a change in base year to 2022-23, shift in composition, and using PPI instead of WPI as deflator
• All the 4 segments of IIP basket were in the green, with electricity and manufacturing leading the way in June 2026

US Federal Reserve held benchmark rate at 3.50%-3.75% in July FOMC meet

• What was different was that the status quo on rates was passed by a vote of 9:3; with 3 FOMC members dissenting
• The dissent vote was in favour of a rate hike of 25 bps in the July policy to help rein in consistently high inflation

Kevin Warsh came in for criticism for not moving aggressively on rate hikes

• While the FOMC continues to be non-committal on the rate trajectory, markets are expecting Fed to be decisive
• While Warsh continues to say that inflation is his priority, the markets are concerned that action is not backing it up

The AI bubble continued to pop during the week with AI stocks taking a hit

• One of the biggest casualties has been the Korean Index (KOSPI), which has fallen over 40% from its June peak levels
• Companies are getting increasingly wary about AI spending, and want to see more clarity on the ROI on AI investments

Indian IT index gains 16% in July 2026, its best returns in more than 5 years

• The popping of the AI bubble has come as a blessing in disguise for the Indian IT stocks, which all ran AI risks
• Investors showed a reversal to their old trade and sought to take refuge in the tried and tested Indian outsourcing models

FCNR(B) flows since June have spiked to $32 billion as leveraged flows come in

• Apart from the attractive rates on FCNR(B) deposits and the forex risk cover, leverage by banks is also a key driving factor
• Major bankers are now expecting the total flows under FCNR(B), OFCBs, and ECBs to exceed $85 billion by Sep-26

After BCCL and CMPDI, Coal India plans to monetize another of its subsidiaries

• Coal India is planning a ₹10,000 crore IPO for Mahanadi Coalfields Ltd (MCL) through an offer for sale (OFS)
• Coal India had witnessed strong demand from investors for the IPOs of BCCL and CMPDI, earlier during the current year

Dedicated freight corridors (DFCs) are realigning the Indian trucking industry

• With bulk of the goods movement happening by rail through these DFCs, trucks are being used more for last-mile delivery
• Not only is the use of trucks for long-distance freight falling; but even the demand pattern is leaning towards LCVs/MCVs

Zepto puts off its IPO plans for now owing to key valuation concerns

• Zepto has put off its IPO plans as the indicative valuation it was getting in the market was well below its expectations
• For now, the funding gaps will be met by Zepto through a $100 million private placement of shares to investors

The IPO of Manipal Health closed on 31-July with 4.92 times subscription

• While the QIB portion got subscribed 8.25 times; HNI portion just scraped through and retail portion fell slightly short
• While healthcare stocks are few in India, Manipal had investor concerns over valuations, profitability, and debt levels

FPIs infused $552.61 million, this week with $1.05 billion coming in last 2 days

• It was a positive month for FPI flows, infusing $2.12 billion into Indian equities in July 2026, dominated by FPI IPO inflows
• In addition, FPIs infused another $2.07 billion into Indian debt paper, taking total FPI inflows in July to $4.19 billion

It was a volatile week for Brent Crude, closing the week at $87.92/bbl

• Cessation of hostilities toned down oil prices; amid growing concerns over the Bab-al-Mandeb strait on the Red Sea
• Houthi rebels have been consistently attacking Saudi tankers in the Red Sea, adding to the tensions in the West Asia region

The USDINR oscillated between ₹95.50/$ and ₹96.00/$ during the week

• While the FCNR(B) flows have offered support to the rupee, oil is still a risk factor and RBI is only doing limited intervention
• The dollar forward rate and the USDINR futures trade on the NSE are hinting at further weakening to ₹96.50/$ levels

Spot gold holds support at $4,000/oz and spot silver at $57/oz for the week

• Both gold and silver have corrected sharply from their January highs, so there are signs of bottom-fishing demand
• However, the 9:3 vote at the Fed has raised the spectre of a rate hike, which is unfavourable for gold and silver prices

SEBI agrees to settle NSE dark fibre and colocation case for ₹1,491 crore

• NSE has already deposited half this amount with SEBI, so it only needs to pay the other half to go ahead with its IPO
• The case has been dragging for over 10 years after it was found that NSE had given preferential access to some brokers

Zee shareholders have backed raising of stake by the promoters to 24%

• This will be done through a ₹3,143 crore fund raising, which will increase the stake of Zee promoters from 3.99% to 24%
• Being a special resolution, it needed over 75% of votes to be passed and the resolution managed to get 76.64% votes

Sun Pharma reported 27% rise in net profits for Q1FY27 at ₹2,895 crore

• For the quarter, total revenues were up 10.5% at ₹15,300 crore, with a 4.7% growth in revenues on sequential basis
• It reported a 2.7% growth in EBITDA to ₹4,418 crore for the quarter, while EBITDA margins were steady at 28.9%

Navin Fluorine signs pact with DRDO for domestic defence chemicals project

• Navin and DRDO will jointly develop the technology to make sodium borohydride, a key chemical in defence applications
• Navin Fluorine is one of the leading specialty chemicals player in India, and the stock price is up 26.7% in the year to date

NTPC will invest ₹17 trillion to boost its power capacity to 250 GW by 2037

• This will include a mix of traditional thermal power capacity, renewable energy (RE) capacity and nuclear power capacity
• In the first phase, NTPC will reach 150 GW capacity by FY32 and scale it up further by around 100 GW in next 5 years

Ownly goes live on Rapido platform in Bengaluru to support the restaurants

• Traditional platforms charge hefty fees and they tend to be financial stiff on the restaurants, while helping the customer
• Under Ownly model, restaurants will pay zero commission and customers are charged fair menu prices with no hidden fees