Developments regarding the US-Iran situation, crude oil prices, and the Reserve Bank of India’s (RBI) interest rate decision are set to influence the equity market trends in the upcoming week, analysts have indicated.
Key factors affecting equities will include macroeconomic data releases, foreign investors’ trading activities, and the fluctuations of the rupee against the dollar. Ajit Mishra, Senior Vice President of Research at Religare Broking Ltd, emphasized that participants will closely monitor global developments related to the US-Iran relationship and the movement of crude oil prices, which are vital for inflation expectations, currency stability, and foreign investments.
The final HSBC Manufacturing Purchasing Managers’ Index (PMI) reading for May is expected to be announced on Monday, followed by Services PMI and Composite PMI data on Wednesday. These indicators are anticipated to offer significant insights into demand trends, business activities, and the resilience of growth across various sectors.
“The primary event of the week will be the RBI monetary policy announcement slated for Friday,” Mishra noted. Furthermore, investors will be observing India’s GDP growth data and foreign exchange reserves numbers for a clearer picture of economic momentum and the stability of the external sector.
In the preceding week, the Bombay Stock Exchange (BSE) benchmark Sensex fell by 639.61 points, or 0.84%, while the National Stock Exchange (NSE) Nifty decreased by 171.55 points, or 0.72%.
Ponmudi R, CEO of Enrich Money, an online trading and wealth management firm, stated that markets are likely to remain highly responsive to geopolitical and macroeconomic developments this week, with particular focus on the evolving negotiations between the US and Iran, along with broader diplomatic movements in the Middle East and crude oil price trends.
In addition to geopolitical concerns, investors are also expected to closely follow rupee performance, institutional flow dynamics, global equity market movements, and essential macroeconomic indicators for further direction.
Santosh Meena, Head of Research at Swastika Investmart Ltd, highlighted that the key domestic event will be the RBI monetary policy meeting, with the announcement scheduled for Friday. He added that market participants will closely scrutinize the RBI’s stance on inflation, liquidity, and interest rates against the backdrop of rising inflationary pressures and currency fluctuations. Additionally, monthly automobile sales data for May will be revealed on June 1, offering insights into sectoral demand trends.
Looking forward, the immediate directional outlook for Indian equities depends on two interconnected catalysts: the RBI’s monetary policy decision and the release of India’s GDP data. Vinod Nair, Head of Research at Geojit Investments Limited, noted that the anticipated PMI and Index of Industrial Production (IIP) data will provide an early indication of industrial momentum for the first quarter of FY27.
Published on May 31, 2026.
