Weekly Market Impact — for the week ending on 09th October 2026

Weekly Capsule (Oct 05 – Oct 09) and Impact Analysis

RBI monetary policy for October 2026 hiked repo rates by 25 bps to 5.50%

• This raised the standing deposit facility (SDF) rate to 5.25% and the MSF/Bank Rate to 5.75% due to their repo rate peg
• Interestingly, the RBI also changed the stance of the policy from “Neutral” to “Calibrated Tightening” to show direction

RBI MPC upped GDP growth estimates, but also raised inflation concerns

• GDP growth estimates for FY27 was upped by 40 bps to 7.1% in sync with strong consumer demand and robust Q1 growth
• However, inflation story has been highlighted raising the CPI estimates for FY27 by 20 bps to 5.2%, due to rising food prices

Nifty and Sensex dip to new yearly lows on Thursday, amid rising crude prices

• While the Nifty touched a 12-month low, the Sensex touched a 32-month low amid rising macro risks and heavy FPI selling
• The situation in the Gulf remains volatile, taking crude to $105/bbl, even as the rupee weakened beyond ₹97/$

TCS, the IT bellwether stock, beat street estimates on revenues and earnings

• Net profit grew 4.01% QOQ to ₹13,884 crore in Q2FY27, while the revenues grew 1.26% sequentially to ₹73,188 crore
• The quarter also saw the AI revenues of TCS touching $3.1 billion, with 24% operating margins and attrition at 13.3%

FPIs were net sellers of $4.58 billion in the first 6 trading days of October

• While FPIs were net sellers on all 6 days, they sold stocks of over $1 billion on 3 of the trading day on macro risks
• Apart from valuation concerns, the FPI sentiments have also been hit by rising crude oil prices and a weak Indian rupee

The latest GST meet made key changes to refund process and to ITC claims

• The plan is to make 90% of GST refund claims system-driven with auto processing if returns not found explicitly deficient
• ITC benefits were extended to group life & health insurance as well as to free samples, stock write-down and telecom towers

Brent Crude touched a high of $105.92 per barrel during the current week

• The spike in crude prices was led by continued disruption of movement through the Straits of Hormuz, amid rising demand
• A bigger concern is the rising cost of supply, higher insurance costs, and depletion of Strategic Petroleum Reserves (SPR)

The RBI support for the Indian rupee shifted from the ₹96/$ to ₹97/$ levels

• Despite $143 billion inflows via FCNR(B), currency markets stay wary of the $200 billion RBI dollar forward shorts
• With the relentless pressure from rising oil and FPI selling, the RBI has also been gradually tweaking its support levels

Domestic air passenger traffic in India contracts for the fourth month in a row

• After contracting by -1% in June, contraction in air passenger traffic widened to -5%, -6%, and -7% in next 3 months
• Most airlines have deliberately cut capacity to avoid adding to their losses amid rising oil prices and a weak dollar

The NPCI is likely to put off the UPI MDR of 0.4% till January 2027

• The decision is likely to be taken after retailers protested that the MDR imposition on UPI could impact festival sales
• Many small vendors had already cautioned customers that they would prefer cash instead of UPI to avoid the MDR

Forex Reserves fell by $12.95 billion in the week to 02-Oct to $734.61 billion

• In the last 3 weeks, the forex reserves have fallen more than $50 billion from a peak level of around $786 billion
• This sharp fall was largely on account of the aggressive dollar selling intervention by the RBI to defend the rupee value

Combination FCNR(B) flows and rate hikes to improve NIMs for banks

• The FCNR (B) flows are likely to put marginal pressure on the NIMs as interest cost and hedging cost of interest are higher
• With 50 bps rate hike likely in 2026, it is likely to sharply widen the spreads for banks, and have net positive impact on NIMs

Monsoon update by IMD shows a 12.6% deficit in rainfall over the LPA

• While Kharif output has not been impacted much, the Rabi output is expected to be well below previous year output
• That is likely to hit rural demand, which is already evident in the tractor numbers and falling FMCG sales in rural India

Spot Gold at $4,198/oz, while Spot silver also trended lower to $60.69/oz

• Both gold and silver are close to support levels, but there is limited buying interest despite a sharp fall from Jan peaks
• Central bank demand is modest, but ETF demand has been weak due to hawkishness raising opportunity cost of gold

India objects after JD Vance accuses Indian IT companies of abusing H1-B

• This came after the US suspended PERM (Permanent Labor Certification) for some of the major IT companies in India
• This does not impact the H1-B visa process but will delay the Green Card process for eligible employees of these companies

Noel Tata seeks meeting with PMO to explain the Trust stand on listing

• With the battle lines drawn between Tata Trusts and Tata Sons, Noel Tata has requested the PM office to get involved
• Tata Trusts feel that listing would dilute control over Tata Sons and also restrict its philanthropy and businesses incubation

Indian apparel market pegged to cross $146 billion by the financial year 2029

• The 9% CAGR till 2020 is likely to be achieved with rising demand for womenswear, kids-wear, and casual-wear
• There is also a rising shift from unorganized apparel to organized apparel market with higher brand consciousness

Jio Platforms IPO price band expected to be in range of ₹1,065-₹1,119

• This will take the potential IPO size to around ₹30,200 crore at a valuation of ₹10.30 trillion; still the biggest IPO in India
• This is lower than the originally pegged valuation at ₹11 trillion and the IPO size is also lower than ₹37,200 crore

The Mizuho-Avendus deal announced in Dec-25 has been approved by the CCI

• Redpoint, a unit of KKR, will sell its majority stake in Avendus to Mizuho Securities of Japan for a sum of $520 million
• RBI has sought a detailed plan from Mizuho on how it will consolidate its other NBFC interests in India with Avendus

India reduces Russian oil purchases to the lowest level since March 2022

• Apart from the availability of cheap Middle East oil, this move was also triggered by narrowing discounts on Russian oil
• India can hit two birds with one stone; as it can access easy oil from the Gulf and also abide by US sanctions on Russia

Surging bond yields in India could compress treasury income of the banks

• With rising yields draining bond values, bank treasury profits may fall from ₹13,100 crore in FY26 to ₹5,500 crore in FY27
• India 10-year bond yields have spiked to 7.30% amid surging US bond yields and expectations of more rate hikes by RBI