Escalating tensions in West Asia are widening the conflict, with investors closely watching Iran's expected missile response against Israel. Brent crude has climbed above $90 a barrel, but global equity markets have so far avoided panic selling.
US equity futures are trading mixed, while Asian markets are moving in different directions.
Gift Nifty, which closed at 24,349 on Friday night, slipped to around 24,279 in early Monday trade before recovering slightly, indicating a weak start for Indian equities.
India's southwest monsoon rainfall deficit widened to 23.8 percent as of July 19, according to the India Meteorological Department.
Kerala's rainfall deficit has worsened to 34 percent. Uttar Pradesh, Bihar, Punjab, Jharkhand, Gujarat, Karnataka, Telangana and Andhra Pradesh are all reporting rainfall shortages exceeding 20 percent. Nearly 65 percent of the country's geographical area is experiencing a rainfall deficit of more than 20 percent.
Weakness in semiconductor stocks and a sharp rise in crude oil prices dragged US markets lower on Friday, resulting in weekly losses for the major indices.
Investor sentiment was also affected by the launch of a powerful low-cost AI model by Chinese start-up Moonshot, raising concerns over increased competition for AI leaders such as Anthropic and OpenAI.
Chipmakers, including Nvidia, and several technology stocks declined sharply, while Apple gained. Apple and Nvidia briefly exchanged the position of the world's most valuable company during the session, but Nvidia reclaimed the top spot by the close.
Brent crude climbed more than 4.5 percent to finish above $88 a barrel.
Shares of Elon Musk's SpaceX fell below $124, while Tesla also declined ahead of its quarterly earnings due this week.
The Dow Jones fell 406.55 points (0.77 percent) to close at 52,146.42. The S&P 500 lost 76.08 points (1.01 percent) to end at 7,457.69, while the Nasdaq Composite declined 361.70 points (1.40 percent) to 25,520.24.
For the week, the Nasdaq lost 2.9 percent, the S&P 500 fell 1.6 percent and the Dow Jones declined 0.9 percent.
US futures were mixed in early Monday trade. Dow futures were down 58 points (0.11 percent), S&P 500 futures slipped 5 points (0.08 percent), while Nasdaq futures gained 20 points (0.08 percent).
Indian ADRs ended mixed after Friday's trading. HDFC Bank closed at $26.36 after edging lower in after-hours trade. ICICI Bank finished at $29.74 after a marginal decline in extended trading. Infosys recovered to close at $11.65, while Wipro extended its gains to end at $1.87.
European markets closed lower on Friday, with the UK's FTSE emerging as the only major index to end higher amid optimism over the country's incoming Prime Minister.
Asian markets opened mixed on Monday.
South Korea's Kospi fell about 3 percent, with SK Hynix down around 2 percent. Japanese markets remained closed for a holiday. Australia's benchmark index gained about 0.2 percent, while Hong Kong and Shanghai indices rose by as much as 2 percent.
Despite sharp declines across global markets on Friday, Indian equities outperformed, largely shrugging off the escalating conflict in West Asia as investors shifted their focus to June-quarter earnings.
The benchmark indices gained more than 1 percent, although the broader market underperformed, with both the mid cap and small cap indices ending lower.
Private banks, IT, realty, automobiles, financials, oil and gas, and FMCG stocks led the rally, while pharma, healthcare and metal stocks remained under pressure.
Foreign portfolio investors continued to sell, offloading equities worth ₹376.41 crore. Domestic institutional investors were net buyers to the tune of ₹1,017.89 crore.
Market breadth remained weak despite the benchmark rally. On the BSE, 1,635 stocks advanced while 2,588 declined. On the NSE, 1,297 stocks gained and 1,988 fell.
Kalyan Jewellers rebounded 4.74 percent after Thursday's decline.
Federal Bank surged 6.55 percent to close at ₹348 after touching a record ₹351.52 following strong June-quarter results. CSB Bank ended marginally higher, while South Indian Bank and Dhanlaxmi Bank declined. Muthoot Finance slipped, whereas Manappuram Finance advanced.
Reliance Industries reported a 26.6 percent increase in first-quarter revenue, but net profit fell 25 percent to ₹23,196 crore. However, earnings comfortably exceeded analysts' expectations. The year-ago quarter had included a one-off gain of ₹8,924 crore from the sale of its stake in Asian Paints.
HDFC Bank disappointed the Street as asset quality weakened. Net interest income grew 6.7 percent, while net profit rose only 5 percent.
ICICI Bank reported 4.36 percent growth in net interest income and a 16 percent rise in net profit, supported by improved asset quality.
Axis Bank posted 8 percent growth in net interest income and a 22.5 percent increase in net profit. Loans rose 18.8 percent, while deposits increased 13.9 percent.
Kotak Mahindra Bank reported 26 percent growth in net profit. Net interest income rose 9.2 percent, while provisions declined 45 percent. Managing Director and CEO Ashok Vaswani is stepping down.
IDBI Bank reported 22.2 percent growth in advances and 10.1 percent growth in net interest income, with improved asset quality.
Yes Bank reported 18.3 percent growth in loans and a 34 percent jump in net profit.
Gold gained more than 1 percent on Friday to close at $4,019.30 an ounce amid rising geopolitical tensions.
However, prices fell to around $3,982 in early Monday trade before recovering towards $4,000.
In Kerala, 22-carat gold closed at ₹1,05,080 per sovereign after Saturday's increase of ₹560, reversing Friday's decline by the same amount.
Silver rose to $56.53 an ounce on Monday morning after closing at $56.08 on Friday.
Platinum traded around $1,590, palladium at $1,235 and rhodium at $7,875.
Industrial metals weakened on Friday.
Copper fell 1.41 percent to $13,373.50 per tonne, while aluminium lost 1.08 percent to $3,150.50. Zinc, tin, nickel and lead also declined.
International rubber prices declined again on Friday, though domestic prices remained firm.
In Bangkok, RSS-1 rubber was quoted at $302.80 per quintal and RSS-3 at $299.40. In Kerala, RSS-4 remained steady at ₹28,200 per quintal.
Cocoa prices gained 3.19 percent to $5,533 per tonne on continued concerns that El Niño-related weather could reduce West African production.
Arabica coffee climbed 2.46 percent to $3.20 per pound amid lower production in Brazil and declining global inventories.
The US Dollar Index closed almost unchanged at 100.77 on Friday and briefly touched 100.87 on Monday morning before easing.
The euro weakened to $1.1434, the pound to $1.3452, while the Japanese yen traded at 162.31 per US dollar. The Chinese yuan remained around 6.77 per dollar.
The yield on the US 10-year Treasury eased to 4.551 percent.
The Indian rupee strengthened by 7 paise on Friday to close at ₹96.28 against the US dollar.
In the offshore non-deliverable forward market, the rupee was trading around ₹96.29. The euro was quoted at ₹110.04, while the Chinese yuan traded at ₹14.19.
The conflict in West Asia pushed oil prices sharply higher after attacks on tankers and desalination facilities heightened fears of supply disruptions.
Brent crude surged 4.59 percent on Friday to $88.10 a barrel and climbed to $91.42 in early Monday trade before easing to around $90.20. WTI crude was trading near $84.44 a barrel.
Cryptocurrencies rebounded over the weekend after Friday's decline.
Bitcoin recovered from around $62,600 to trade above $64,500. Ether climbed above $1,870, while Solana traded above $76.
Sensex: 78,151.45 (+1.25%)
Nifty 50: 24,334.30 (+1.09%)
Bank Nifty: 58,521.40 (+1.63%)
Nifty Midcap 100: 62,428.05 (-0.41%)
Nifty Smallcap 100: 19,296.30 (-0.21%)
Dow Jones: 52,146.42 (-0.77%)
S&P 500: 7,457.69 (-1.01%)
Nasdaq Composite: 25,520.24 (-1.40%)
US dollar: ₹96.28 (-₹0.07)
Gold (per ounce): $4,019.30 (+$42.10)
Gold (22K, per sovereign): ₹1,04,520 (-₹560)
Saturday: ₹1,05,080 (+₹560)
Brent crude: $88.10 (+$3.87)
