Sensex Nifty week ahead: US-Iran situation, US inflation data among 10 key factors to watch

Crude oil prices are expected to remain a key market driver amid developments related to shipping routes in the Strait of Hormuz.

Developments in the West Asia, crude oil prices and US inflation data are expected to be the major drivers for the stock market next week.

Trading activity of foreign investors and global market trends will also influence domestic equities. The 18th BRICS Summit will be also held in New Delhi on September 12-13.

10 key factors to watch

1) US-Iran situation: Iran said it struck an unmanned US vessel trying to enter the Strait of Hormuz, the latest development in a new flare-up of fighting between the two countries.

The US did not immediately confirm the purported attack, which came a day after the US military said its forces struck three Iranian oil tankers in response to a missile attack on Navy warships, reported AP.

2) Crude oil prices: Crude oil prices are expected to remain a key market driver amid concerns over global supply disruptions and developments related to shipping routes in the Strait of Hormuz.

Brent crude jumped about 8 percent last week as intensifying US-Iran hostilities stoked inflation concerns and drove global bond yields higher, putting pressure on risk assets.

Brent crude gained more than 8 percent during the week, while WTI crude rose over 9 percent, as renewed US-Iran hostilities and concerns surrounding the Strait of Hormuz increased the geopolitical risk premium in global energy markets, Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm, said.

3) US inflation data: With the latest US jobs data coming in stronger than expected and pointing to resilient underlying economic momentum, attention now shifts to the upcoming US inflation data, which could prove critical in shaping expectations for Federal Reserve policy and global market sentiment.

“The direction of Treasury yields and interest-rate expectations will remain closely intertwined with the inflation narrative, while elevated oil prices amid the unresolved Middle East conflict are likely to remain a persistent overhang on market sentiment,” Hariselvan Radhakrishnan, founder and CEO of HST Wealth, a Research Analyst firm, said.

4) Primary market activity: India’s primary market is bracing for another packed week, with 11 main-board companies, including Rentomojo, Karamtara Engineering and Kanohar Electricals, set to raise Rs 7,055 crore through initial public offerings (IPOs).

The companies heading to the primary market span real estate development, engineering and manufacturing, payments and identity solutions, specialty chemicals, and online rental services.

“This multi-issue rush reflects an eagerness to lock in early-stage growth equity in young companies as all these companies are below USD 1 billion market cap at listing,” said Rajkumar Rathi, Chief Investment Officer at YES Securities.

5) Rupee movement: The movement of the rupee against the US dollar will be closely watched after the Indian currency posted its best weekly performance against the US dollar in five weeks, helped by stronger-than-expected dollar inflows into the central bank’s special schemes.

6) FII activity: After investing in Indian equities for two consecutive months, foreign investors turned net sellers in the first week of September, pulling out Rs 7,443 crore as a rebound in crude oil prices, rising US bond yields and a firm dollar dented risk appetite.

The outflow came after foreign portfolio investors (FPIs) infused Rs 30,919 crore in August and Rs 20,200 crore in July. Before that, they remained net sellers for four straight months from March to June.

With the latest withdrawal, total outflow by foreign portfolio investors from Indian equities has climbed to Rs 2.32 lakh crore so far in 2026, surpassing the Rs 1.66 lakh crore withdrawn in 2025.

Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said, “The resilience of the Indian economy, as indicated by the Q1 FY27 GDP growth rate of 7.8%, and the better-than-expected Q1 earnings numbers and stabilisation of the rupee are other positive factors that have the potential to sustain the positive FPI inflows into India. The massive $127 billion that came to India under the FCNR (B) scheme has strengthened the rupee significantly from the low of 96.96 to the dollar in May to 94.49 on 4th September. This is hugely significant from the FPI perspective. However, going forward, the FPI flows will be primarily influenced by the bond yields which are rising globally. It would be irrational to expect significant FPI flows into India when the U.S. 10-year bonds and 30-year bonds are yielding 4.78% and 5.27% respectively.”

7) Technical outlook: On the technical front, the Nifty 50 closed the week at 23,897.70, slipping below its 20-week, 50-week and 100-week simple moving averages, indicating that the broader technical structure remains under pressure.

For the last week, the benchmarks lost up to 1.2 percent, marking their fourth consecutive weekly decline and longest losing streak in five months. Twelve of the 16 major sectors declined during the week. Small-caps gained 0.1 percent, while mid-caps fell 1.5 percent.

For the coming week, 24,000 remains the immediate technical trigger. A decisive close above this level would provide the first meaningful indication that buyers are beginning to regain control. Until then, the market is likely to remain sensitive to global cues, with volatility expected to stay elevated, noted Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, a SEBI-registered Research Analyst firm.

8) Global cues: Among global cues, US inflation data, the European Central Bank meeting, Japan’s GDP growth and China’s inflation data will be in focus.

9) Domestic economic data: Foreign exchange reserves for the week ended September 4 will be released on September 11 (Friday).

10) Corporate actions

Daily Current Affairs 5th September 2026

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