India Stocks: Indian shares fall on oil, Fed hike bets; HDFC Bank caps losses

HDFC Bank

31/08/2026 05:50

Updates for morning trade
By Bharath Rajeswaran and Vivek Kumar M
Aug 31 (Reuters) - Indian shares fell in early trade on Monday as higher crude prices and fears of U.S. rate hikes weighed on market sentiment, as investors braced for potential volatility from an MSCI index rejig and the country's new stock closing system.     
The Nifty 50 .NSEI fell 0.68% to 24,011.48 and the BSE Sensex .BSESN shed 0.58% to 76,824.45 as of 10:13 a.m. IST. 
HDFC Bank HDBK.NS, which has the largest weight on the indexes, rose 1.5% after CEO Sashidhar Jagdishan decided to not seek reappointment at the end of his term in late October.  
"We believe the CEO exit is a cleaner outcome, as term extension from RBI would have been difficult amid the recent operational and governance lapses," said Nuvama Institutional Equities, adding that the board has more time to identify a successor.  
Oil-to-telecom conglomerate Reliance Industries RELI.NS fell 1% ahead of the MSCI index rejig, which will be implemented at this session's close.
The weighting of Reliance in the MSCI Global Standard index will be lowered, triggering potential outflows.
Traders worried about volatility as the index change happens weeks after a new share closing system was launched. 
"This session will absolutely be a litmus test for the new closing auction session, as it will test the method under a known and concentrated institutional flow event," said Ponmudi R, CEO of wealth management platform Enrich Money.
Global investor sentiment soured after U.S. forces struck two Iranian launchers, marking the first known American strikes on Iran since late July and pushing Brent crude LCOc1 up 2.5% to $90 per barrel. O/R
This came after U.S. Federal Reserve Chair Kevin Warsh's comments raised the odds of a near-term rate hike in the world's largest economy.
In India, all 16 major sectors fell. The IT index .NIFTYIT fell 2% after rising 3.5% in the previous session. 
Small-caps .NIFSMCP100 and mid-caps .NIFMDCP100 slipped 1% each.




 (Reporting by Vivek Kumar M and Bharath Rajeswaran; Editing by Eileen Soreng and Mrigank Dhaniwala)
 ((VivekKumar.M@thomsonreuters.com;))