Indian equities remained under pressure at midday on Thursday, with the benchmark indices extending losses as a fresh spike in crude oil prices, a weaker rupee and persistent risk aversion linked to West Asia tensions kept sentiment fragile.

Around 1:20 pm, the Nifty 50 was trading near 24,255, down 122 points or 0.50%, while the Sensex was off about 525 points intraday.

Oil shock, rupee slide drive risk-off mood

The selloff was led by renewed concerns over India’s macro exposure to higher energy prices after Brent crude climbed above $100 a barrel, and touched an intraday high of $106 amid shipping tensions in the Gulf and stalled peace efforts involving the US and Iran.

Rupee added to the pressure, slipping below touching 94.1525 per US Dollar before trimming some losses to around 94.04, its weakest level in more than three weeks. For import-heavy India, the combination of high crude and a falling currency has revived worries around inflation, margins and the current account outlook.

Financials, autos lead decline; pharma offers some shelter

On the Street, the selling was concentrated in financials and autos. The Nifty auto index was down 1.3% and major financial names dragged benchmarks lower. Among heavyweights, ICICI Bank fell 1.6% and HDFC Bank lost 0.8%, while defensive buying kept pharma up 2.3%. Almost 12 of 16 major sectors were trading in the red, stressing the broad-based nature of the weakness even as some pockets of the broader market showed relative resilience.

Broader market comparatively steadier, but breadth stays weak

Despite the benchmark weakness, the broader market was relatively more resilient than frontline indices earlier in the session, with Reuters noting modest gains in small- and mid-cap stocks. Even so, market breadth remained negative.

The risk-off setup also showed up in volatility gauges. India VIX was up about 2%. However, the volatility index did not swing Thursday as much as it did during days of heightened geopolitical uncertainty.

Foreign outflows and brokerage caution add to pressure

Foreign flows remained another overhang. Foreign portfolio investors have pulled out $4.3 billion from Indian equities in April so far, taking 2026 outflows to $18.5 billion year-to-date, according to Reuters. Adding to the cautious tone, HSBC downgraded Indian equities to “underweight”, warning that the jump in crude could cloud the earnings recovery and make valuations harder to justify if oil stays elevated. The brokerage said a 20% rise in crude could shave 1.5 percentage points off earnings growth forecasts.

At this stage, the market is effectively repricing three risks at once: higher imported inflation from crude, currency weakness, and slower earnings recovery if input costs stay elevated.