Last week, the Indian stock market ended weak. The Sensex dropped 1.30% and the Nifty 50 fell 1.14% due to many global and local worries. As we enter this new week, there are five major factors that may continue to keep markets shaky.
The first is the Israel–Iran conflict, which has made global investors nervous. Reports say that the U.S. military is shooting down Iranian missiles targeting Israel, while the UK has also sent jets to the region. This has increased global fears, pushing investors towards safe-haven assets like gold and U.S. bonds, while global stock markets, including India’s, have faced selling pressure.
Next, all eyes are on the U.S. Federal Reserve meeting scheduled for June 17–18. The market expects the Fed to keep interest rates unchanged, but everyone will be watching their statements for hints about possible future rate cuts. In May, the U.S. inflation (CPI) stayed soft at 0.1% month-on-month and 2.4% year-on-year, raising hopes that the Fed may cut rates later this year.
A major concern for India is the recent sharp jump in crude oil prices. On Friday alone, Brent crude jumped 7% to reach $74.23 per barrel, leading to a weekly gain of 12.5%. Since India imports most of its oil, rising prices can increase the import bill, weaken the rupee, create inflation pressure, and hurt companies like oil refiners, paint makers, and cement producers by increasing their costs.
Another factor pulling down the market is the foreign investor selling. So far in June, foreign portfolio investors (FPIs) have sold ₹4,812 crore worth of Indian equities. High global uncertainty and rich stock valuations have made many foreign investors cautious, leading to selling pressure on Dalal Street.
Lastly, the arrival of the monsoon season will be closely watched. A timely and well-spread monsoon is crucial for India’s farmers, rural economy, FMCG companies, and agri-input businesses. Good rains could boost rural demand and help many sectors, but any delays or weak rainfall could hurt investor sentiment.
In short, this week may remain highly volatile for Indian equities. Investors should watch for any new developments in the Middle East conflict, Fed meeting updates, oil prices, FPI flow trends, and monsoon progress — as each of these factors could impact market movement in the days ahead.