Markets slip 2% as oil bounces back to $111/bbl

Benchmark indices declined more than 2% after crude oil bounced back to $111 a barrel after hopes of de-escalation between the U.S. and Iran faded on Friday (March 27, 2026).

Nifty 50 and Sensex shed 2.09% and 2.25% to 22,819.60 and 73,583.22 points respectively, paring small gains that were made in the past two sessions. 

Nifty opened at 23,173.55 points and a little over 10 points to touch the day’s high before tumbling to the day’s low of 22,804.55 points and finally hit the day’s close. Sensex too had a similar pattern in the day.

All the 21 Nifty sectoral indices dipped with Nifty Auto dipping 2.8%. Foreign Institutional Investors (FII) withdrew ₹1565.63 crore in equity adding to the record monthly outflow. 

Global equities researchers have downgraded the outlook for Nifty. For instance, Goldman Sachs Research downgraded Indian equities outlook for the next 12 months to 25,900 points from its earlier 29,300 points.

A heating up Iran and U.S. war increased the Brent crude futures price to $104 a barrel. U.S. President Donald Trump had claimed that there were talks with Iran, which the latter denied. This doused hopes of any meaningful de-escalation among global investors sending the Brent crude futures up over 6% in the past two days. 

The record FII outflows and the still high oil prices pushed the foreign exchange rate to another all time low of $94 a dollar and is expected to depreciate further as long as energy flows remain constrained, said Anindya Banerjee, Head of Currency and Commodities Research at Kotak Securities. A worsening West Asian situation could push the rupee-dollar pair to as low as ₹97 a dollar, he said.