US–Iran Hostilities Flare Again — SBI NIM Miss Triggers PSU Bank Rout; MidCap Scales Fresh Peak
Friday, 8 May 2026 · Benchmarks extend losses; IT outperforms; PSU Banks crash 3%+
| Sensex | 77,328 | ▼ 516 pts |
| Nifty 50 | 24,176 | ▼ 150 pts |
| Bank Nifty | 55,311 | ▼ 736 pts |
| Brent Crude | ~$101 | ▲ Back above $100 |
| Indicator | Value | Note |
|---|---|---|
| Nifty 50 | 24,176.15 | ▼ 150.50 pts (−0.62%) |
| Sensex | 77,328.19 | ▼ 516.33 pts (−0.66%) |
| Brent Crude | ~$101 | Rebounded above $100 on fresh US–Iran clashes |
| Rupee / USD | ~₹94.5 | Weakened from ₹94.2; oil-driven reversal |
| India VIX | ~17–18 | Elevated; fear ticking up again |
Indian markets ended lower for a second consecutive session on Friday as a double-barrelled shock hit sentiment — renewed US–Iran military clashes near the Strait of Hormuz drove crude back above $100, while SBI's disappointing NIM numbers triggered a savage 7% fall in the country's largest bank, dragging the entire PSU banking complex down 3%+. The Nifty fell 150 points and the Sensex slumped 516 points. Yet below the headline carnage, the session had notable bright spots: Nifty IT surged 1.2%, the Nifty MidCap 100 scaled a fresh intraday all-time high of 62,113.85, and the SmallCap index edged up 0.22%.
Story 01 · Macro Catalyst
US–Iran Military Clash · Crude Rebounds Above $100
Peace Deal Hopes Dashed — US Forces Intercept Iranian Attacks Near Hormuz; Brent Jumps Back to $101
After Thursday's optimism around a US–Iran peace framework, Friday turned dark again. Fresh military exchanges erupted near the Strait of Hormuz — US Central Command confirmed American forces intercepted Iranian attacks and conducted defensive strikes as guided missile destroyers passed through the strait. The Trump administration clarified it was not seeking escalation, but markets were unmoved by the diplomatic language.
Brent crude, which had touched an intraday low of $96.77 on Thursday, surged back above $101 per barrel — erasing much of the prior session's peace-deal optimism. For the week, however, both Brent and WTI were down approximately 6% as the earlier ceasefire hopes had dramatically depressed prices mid-week.
The rupee weakened back to ~₹94.5 from ₹94.2, reversing part of its two-day recovery. Higher crude prices immediately translated into renewed currency pressure given India's elevated energy import exposure. The Trump administration continues to await Tehran's formal response to the peace proposal via Pakistani intermediaries, with a reply expected within the next two days. Until then, every headline from the Persian Gulf will whipsaw Indian markets ±1–2% within minutes.
Story 02 · Market Structure
Benchmarks · Breadth · Derivatives
SBI Crash + Geopolitics = Double Whammy — But MidCap Makes Another Intraday High
Nifty PSU Bank Tanks 3.06%; Nifty IT Rises 1.2%; MidCap 100 Tags 62,113 Fresh Peak
The session's defining domestic shock was SBI's Q4 FY26 results. India's largest public sector bank reported a 5.6% rise in net profit to ₹19,684 crore, but markets zeroed in on shrinking Net Interest Margins — a signal that the NIM compression story in PSU banks has legs. SBI shares crashed 7%, dragging Bank of Baroda and Axis Bank lower with it. The Nifty PSU Bank index fell 3.06% and Nifty Financial Services declined 1.66%.
On the other side of the ledger, IT was the standout sector, with the Nifty IT index gaining 1.2% — a notable divergence from the broad market sell-off, supported by global tech optimism and defensive positioning. Nifty Capital Markets was the second-best sectoral performer.
In the broader market, the story remained resilient: the Nifty MidCap 100 hit a new intraday all-time high of 62,113.85 (closing marginally lower at 61,911, −0.15%), while the Nifty SmallCap 100 managed a positive close of +0.22%. Specific Q4 result winners shone brightly: Thermax surged ~12% (net profit +18.7% to ₹244 Cr), Sonata Software jumped ~10% (Q4 profit +25% YoY), and Titan gained ~5% (Q4 profit +35% YoY, total income +46% YoY to ₹20,300 Cr).
Story 03 · Participation Analysis
FII/DII Flows · Global Markets
Risk-Off Returns — Banking Sell-Off & Crude Spike Dampen Friday Mood; Asian Markets Weak
Global cues were broadly negative on Friday. Asian and European markets fell as the escalation in US–Iran conflict reversed oil-related optimism from mid-week. The Strait of Hormuz situation remains the pivotal global macro variable — the IEA warned the conflict is disrupting roughly 14 million barrels per day of global oil supply, with any post-conflict production recovery expected to proceed gradually.
The rupee's reversal to ~₹94.5 from its intraday recovery highs underscores how quickly macro conditions can shift. FII behaviour through Friday will be closely watched — after returning as net buyers earlier in the week (a reversal from April's brutal $7.5 billion outflow month), Friday's geopolitical flare-up risks a renewed pause or modest selling. DIIs continue to provide structural support through domestic SIP flows and mutual fund buying, acting as a floor against sharp FII-driven falls.
Index Performance — Friday, 8 May 2026
| Index | Close | Change | Signal / Notes |
|---|---|---|---|
| Nifty 50 | 24,176.15 | ▼ −150.50 pts (−0.62%) | Lost 24,300 level; 24,100 now key support |
| Sensex | 77,328.19 | ▼ −516.33 pts (−0.66%) | SBI + geopolitics double whammy; 77,000 in focus |
| Bank Nifty | 55,310.55 | ▼ −736.85 pts (−1.32%) | PSU bank rout; 55,000 critical support |
| Nifty MidCap 100 | 61,911 (intraday high 62,113) | ▼ −0.15% | New intraday all-time high despite benchmark fall |
| Nifty SmallCap 100 | — | ▲ +0.22% | Resilient; continues to outperform benchmarks |
| India VIX | ~17–18 | ▲ Inching up | Fear rising again; watch 19–20 zone |
Sector Performance — Friday, 8 May 2026
| Sector | Move | Notes |
|---|---|---|
| IT | ▲ Top Outperformer | Nifty IT +1.2%; Infosys, HCL Tech among winners; defensive buy on macro uncertainty |
| Capital Markets | ▲ Strong | BSE Q4 results: profit +61%, ₹10 dividend declared; sector re-rating continues |
| Consumer Durables | ▲ Mild | Titan +5% on strong Q4 (profit +35% YoY); reversal from Thursday's laggard position |
| PSU Banks | ▼ Worst Performer | Nifty PSU Bank −3.06%; SBI −7% on NIM miss triggers sector-wide de-rating |
| Pvt Banks / Financials | ▼ Weak | Nifty Financial Services −1.66%; HDFC Bank, Axis Bank among biggest Sensex laggards |
| Cement / Infra | ▼ Mild | UltraTech Cement among Sensex laggards; crude cost + rates headwinds |
| FMCG | ▼ Mild | Defensive appeal limited; continued de-rating in risk-on pockets |
| Auto | — Neutral | Post-Thursday's surge, consolidation; Bajaj Finance a notable laggard on day |
Notable Stock Movers — Friday, 8 May 2026
🟢 Top Gainers
| Stock | Move |
|---|---|
| Thermax | ▲ ~+12% · Q4 net profit +18.7% to ₹244 Cr |
| Sonata Software | ▲ ~+10% · Q4 profit +25% YoY; revenue +4% |
| Titan Company | ▲ ~+5% · Q4 net profit +35% YoY; income +46% |
| Apollo Hospitals | ▲ Positive · Top Nifty50 gainer |
| Asian Paints | ▲ Positive · Crude input cost easing tailwind |
| Adani Ports | ▲ Positive · Among Sensex winners |
| Infosys / HCL Tech | ▲ Positive · IT sector outperformance |
🔴 Notable Laggards
| Stock | Move |
|---|---|
| SBI | ▼ −7% · NIM compression in Q4; dragged entire PSU bank sector |
| HDFC Bank | ▼ Negative · Financials broad sell-off |
| Bajaj Finance | ▼ Negative · Financial services weakness |
| Axis Bank | ▼ Negative · PSU bank contagion |
| UltraTech Cement | ▼ Negative · Macro headwinds |
| M&M | ▼ Negative · Among Sensex laggards |
FII vs DII Flows — May 2026
FII — May 2026 (MTD) Tentative — Watch Friday Data FIIs had returned as net buyers on May 6–7 after April's brutal $7.5 Bn outflow. Friday's crude spike and SBI shock risk reversing the tentative improvement. The sustainability of the FII return remains the most important flow dynamic to monitor into next week.
DII — May 2026 (MTD) Strong Buyers — Structural Floor DIIs remain a consistent structural floor — domestic SIP inflows and mutual fund buying continue to absorb selling pressure. Even in Friday's selloff, DII flows are expected to have cushioned the benchmark decline.
Technical Picture After Friday's Close
| Level | Value | What It Means for You |
|---|---|---|
| Nifty Close | 24,176.15 | 24,300 support decisively breached; bulls need a quick reclaim |
| Nifty Support 1 | 24,100 → 24,000 | Immediate and critical zone; 24,000 is the line in the sand |
| Nifty Support 2 | 23,800 → 23,700 | Medium-term support; breach = deeper correction signal |
| Nifty Resistance | 24,300 → 24,400 | Now resistance; reclaiming 24,300 first step for bulls |
| Bank Nifty Support | 55,000 → 54,800 | Multi-tier support; Friday close at 55,311 barely above it |
| India VIX | ~17–18 | Creeping up; if crude spikes further, VIX could retest 19–20 |
| Sensex Support | 77,000 → 76,800 | Watch for stability here over the weekend |
Risks & Opportunities
⚠️ US–Iran Binary — Now More Dangerous Fresh military exchanges on Friday have complicated the peace deal timeline. Tehran's response via Pakistani mediators is due in 2 days. A deal → Brent falls to $88–92, Nifty targets 24,500+. Renewed conflict → Brent back above $110, Nifty tests 23,700–23,500. Status: Critical — single most important global event for India
🏦 PSU Banks — SBI NIM Miss Triggers Sector Re-Rating SBI's Q4 profit grew 5.6% to ₹19,684 Cr but NIM compression disappointed. The PSU Bank index crashed 3%+. This is not a one-day story — NIM trajectory for the full banking sector will now come under a microscope. Exercise caution on PSU bank positions near term. Status: Elevated — structural concern
💻 IT — Friday's Surprise Hero Nifty IT gained 1.2% while everything else fell. Defensive dollar-earning character, global tech strength, and positioning make IT a near-term safe harbour. Opportunity: Tactical positioning in IT
🛢️ Crude Back Above $100 — Rupee Risk Returns Brent above $101 after Friday's clashes erases Thursday's relief. India's CAD, rupee, and RBI rate-cut narrative are all directly linked to whether crude can sustainably hold below $100. The $100 line is the pivot of India's macro story. Status: Elevated — monitor daily
📊 Q4 Results Season Still Delivering Thermax (+12%), Sonata (+10%), Titan (+5%) — results-driven movers continue to outperform in a choppy tape. Focus on companies reporting strong earnings with forward guidance as the primary stock-picking framework. Opportunity: Results-driven accumulation
🌏 Fed & Global Liquidity — No Relief Yet The Fed held rates at 3.5–3.75% and priced out all 2026 cuts. Friday's crude rebound weakens the case for a shift in tone. The Fed minutes will be carefully parsed for any softer language on inflation. Status: Medium-term overhang
Radar: What to Watch — 9–11 May 2026
☮️ Tehran's Response — The Weekend Wildcard Iran's reply to the US peace framework is expected within two days. Any response — yes, no, or counter-proposal — will gap-open Indian markets on Monday. This is the single most important event for Dalal Street next week.
🛢️ Brent Crude — Can $100 Hold as Ceiling Again? Friday ended with Brent at ~$101. A sustained close back above $100 materially shifts India's macro narrative on inflation, CAD, and RBI rate cut probability. The $100 level is now a battleground.
🏦 SBI Post-Results Fallout — Contagion Watch SBI's 7% crash will have ripple effects on the broader banking and PSU index. Watch for management commentary from the analyst meet and any further broker downgrades on NIM outlook. Bank of Baroda and Union Bank of India results to follow.
📊 Q4 Results Continuing — Swiggy, HDFC Life & More Swiggy Q4 preview is in focus — loss trajectory and order volume growth will be key. HDFC Life and other financials are also in the results queue. Management commentary on margins, cost pass-through, and guidance will dominate stock-specific action.
🌏 Fed Minutes & Global Cues US Federal Reserve meeting minutes due — any softer tone on inflation, even amid crude's rebound, could reassure EMs and partially restore FII flow confidence. European and Asian market direction over the weekend will set Gift Nifty tone for Monday.
Closing Thought
24,300 Was the Floor — It Just Became the Ceiling. Focus on What's Still Working.
Thursday's peace-deal optimism was fleeting. Friday's session stripped away two important supports simultaneously: the geopolitical tailwind evaporated as US–Iran clashes resumed, and India's largest bank disappointed on the most-watched banking metric. The Nifty fell 150 points, SBI fell 7%, and Brent climbed back above $100.
And yet — IT rallied 1.2%. The MidCap index hit a fresh all-time high intraday. Thermax, Sonata, and Titan delivered strong Q4 results and rewarded shareholders. The market's internals are not uniformly bearish.
The roadmap for next week:
- Watch Tehran's response as the binary that matters most. A deal changes everything positively; a breakdown risks a retest of 23,700.
- Reclaiming 24,300 is the first technical hurdle for bulls — until then, the path of least resistance is cautious.
- IT and quality earnings plays (Thermax, Titan-type) are the sectors that work in a choppy, geopolitically uncertain tape.
- Avoid adding to PSU banks until NIM trajectory becomes clearer — Friday's SBI shock may be the beginning of a broader sector re-rating.
- The ₹100 crude line is India's macro pivot. Everything — rupee, inflation, RBI rate cuts, OMC margins — hinges on whether crude can return below it.
Stay data-driven. One headline from Hormuz can move markets 2% in either direction before you can react.
SEBI Regulatory Disclaimer — Strictly for Educational & Informational Purposes Only This publication is solely for informational and educational use. It does NOT constitute investment advice, a research report, or a solicitation to buy/sell securities. The author/publisher is NOT a SEBI-registered Research Analyst. All data is sourced from publicly available exchange filings, news reports, and brokerage updates as of 8th May 2026, and may be subject to revision. Investments in securities are subject to market risks. Past performance is not indicative of future results. Readers are strongly advised to consult a SEBI-registered investment adviser before making any financial decisions. | SEBI SCORES · Helpline: 1800 266 7575 · sebi.gov.in
Written By Rupie Times D
