Indian equity markets continued their downward trend on Friday, marking the seventh consecutive day of losses as global geopolitical tensions and rising crude oil prices hurt investor sentiment. The Nifty Smallcap 100 index fell over 3%, while Swiggy shares plummeted 16% following disappointing quarterly results. Investors are concerned about widening losses in the company's quick-commerce segment, which has dampened the firm's profitability narrative.
Indian equity markets ended the week on a weak note, extending their losing streak to seven consecutive trading sessions. The Nifty Smallcap 100 and Nifty Midcap 100 indices both saw sharp declines of around 3% on Friday, as selling pressure spread across smaller stocks. The benchmark Nifty 50 also closed 1% lower, unable to hold on to early session gains.
The broader market sell-off is largely driven by macro concerns. Escalating geopolitical tensions in West Asia have kept investors on edge, while the rise in crude oil prices has added to worries about higher inflation and increased import costs for the country. When oil prices rise, it often creates pressure on the rupee and increases the financial burden on oil-importing companies, which can impact overall market sentiment and lead to outflows from foreign investors.
Swiggy emerged as a major focus for investors on Friday after shares plunged 16%. The sell-off was triggered by the company's quarterly financial report, which showed widening losses in its quick-commerce division for the September quarter of fiscal year 2026-27. This is a crucial area for the business, as many investors were closely tracking the company's progress toward achieving profit in its fast-delivery model. With brokerage firms reportedly cutting target prices for the stock, the market’s confidence in the firm's immediate path to profitability has been shaken.
Smallcap stocks faced the most intense selling pressure, with 96 out of 100 companies in the Nifty Smallcap 100 index closing in the red. Stocks like TD Power Systems, Inox Wind, Ola Electric Mobility, and Karur Vysya Bank were among the notable decliners, with some falling as much as 7% during the day. Similarly, the midcap segment saw significant movement, with Motilal Oswal Financial Services, National Aluminium Company, Adani Total Gas, and Mahindra & Mahindra Financial Services recording losses of up to 5%.
For investors, the current market trend reflects a shift in risk appetite, where caution is prevailing over growth expectations. The key monitorables in the coming sessions will be the movement in global crude oil prices and any updates regarding geopolitical developments. Additionally, for companies like Swiggy, the primary focus for the market will be how management plans to control costs and improve margins in the competitive quick-commerce space in the upcoming quarters.