N ArunaGiri, CEO, TrustLine Holdings 

Rupee breaching one level after another is more a reflection of sentiment-driven weakness than any serious deterioration in macro fundamentals.

But the real risk is that, if left unchecked, this loss of confidence can turn into a self-fulfilling vicious cycle - triggering further pressure on the rupee that is not warranted by underlying fundamentals.

If one looks at India's macro position today, the situation is far from alarming. The current account deficit remains manageable, forex reserves are reasonably comfortable with import cover of nearly eight to nine months, and the fiscal deficit trajectory continues to remain relatively stable. Given these macro metrics, there is little justification for such a sharp depreciation in the rupee.

However, currency markets are often driven as much by perception as by fundamentals. When investment flows weaken and markets begin anticipating further outflows amid an uncertain geopolitical backdrop, that expectation itself starts exerting pressure on the currency. If such sentiment is allowed to build unchecked, it can create its own cycle of panic and accelerated depreciation.

This is precisely why it is extremely critical for the RBI to step in proactively and announce confidence-building measures, similar to the steps initiated by former RBI Governor  Raghuram Rajan during the 2013 currency crisis. Any delay in action risks aggravating market nervousness and intensifying pressure on the rupee further.

The RBI cannot afford to remain a passive spectator at this stage. What the market needs immediately is a strong policy signal that restores confidence and breaks the negative sentiment cycle.

One possible measure could be launching FCNR dollar deposits, which can help attract foreign currency inflows and provide immediate relief to near-term pressure on the rupee. Government from its side, could look at tax concessions for FII investments like cutting TDS on bond sales, reductions in capital gains taxations etc. It is time for action now.

Nifty: Below 23700, weakness may continue towards 23500-23400. Resistance at 23850 & 24000.

Bank Nifty: Below 54000, downside towards 53500-53000. Resistance at 54250.

Sensex: Below 75500, weakness towards 74800-74600. Resistance at 75800-76000.

Stocks with Positive Setup: Crompton, Solar Industries, Motherson, MCX, Biocon, Dr Reddy, Mankind.

Weak Stocks: HAL, IOC, BPCL, Voltas, PNB, Cochin Shipyard, Kalyan Jewellers.

India Steel Production: India remains one of the quickest expanding steel markets in the world. Read full report here

Rajesh Palviya, Head of Research, Axis Direct

The Nifty slipped 46 points on Friday to 23,643.5, ending a two-day winning streak as Brent surged past $109 and the Rupee hit a record low of 96 against the dollar. Wall Street sold off sharply, with the S&P 500 down 1.24%, the Dow losing 537 points, and the Nasdaq retreating 1.54% as tech companies took profits and oil-driven inflation fears reemerged. Asian markets are negative this morning, gold sits near $1,450, silver below $17.70, and copper at $6. Crude oil has risen to $110.7 amid fresh warnings from Trump to Iran. GIFT Nifty is at 23,555.5, implying a gap-down of about 100 points. Technically, bulls need a daily close above 23,700 to continue the recovery toward 24,000, while 23,500 remains a crucial support level. With oil prices high, failure to hold the opening zone could quickly bring 23,400-23350 into play.

Kamaljit Anand, former external statistical analyst for Central Board of Indirect Taxes & Customs

Whether these are the right duty rates or not, these rates are not permanent rates and are a temporary import deterrent rate. So, one can expect it to go up further in the interim up to 25% and then recede back sequentially to about 10% in the mid term. In 2014, while working on the recommendation report, we had proposed a duty rate of 10% when the prevailing rate was about 1.5%, which was not accepted initially and the first increase was only to 3%. Slowly, when it was not effective, the rate was revised two-three times more to finally settle at 8.5%. That helped arrest the gold rush, but had some other implications.

The current duty rate increase is likely to act as a moderate deterrent, but would not be able to have a far-reaching impact on imports as institutional importers follow their own market analysis and forecasts. As per our analysis, the swing point would be at about 24% duty rate, where the majority of importers would stall gold imports. At that rate, however, the parallel channels become hyperactive and stocking patterns become different. It hits government collections doubly - on customs duty as well as GST collection.

It absolutely would trigger parallel channels to become hyperactive on the border as well as via international air traffic. The country's intelligence and enforcement departments today have strong data analytics and AI systems to read errant traffic via APIS and allied airline data for specific countries of origin, travel patterns, cartels and errant travel conduits. The risks are studied and rules are refreshed at a very good frequency. International borders are a bit difficult, and the intelligence systems there follow different protocols and have improved considerably. Please expect a lot of interdictions in air traffic as well as land borders. There are other places also, but cannot mention here.

Fuel Price Hike: India imports more than 85 per cent of its crude oil needs. Any sustained increase in oil prices directly hits inflation. Read full report here

Strait of Hormuz-driven Elevated Oil Prices, G7 Meeting

Flows through the Strait of Hormuz remained heavily restricted, keeping the oil prices well-above $100 a barrel throughout the week before the Brent crude futures, the international oil benchmark, ended the week with an 8.7 percent rally at $109.14 a barrel. This ultimately is expected to impact import cost and increase the current account deficit, along with inflation concerns for the oil-importing nations, including India. 

FOMC Minutes

Barring a ceasefire breakthrough that meaningfully restores Hormuz flows, elevated inflation pressures and the sharp repricing of Fed expectations are likely to remain the dominant drivers for both energy and metals markets in the near term. In the coming week, on the United States front, the market participants will closely watch FOMC minutes, May PMI readings, and University of Michigan inflation expectations data for further clarity on the policy outlook, particularly as Kevin Warsh begins his tenure as the new Fed Chair.

Global Economic Data

Apart from US economic releases, focus will also be on flash PMI readings of other nations, including Japan, the UK, and even Europe. China's retail sales, industrial production, and unemployment rate data for the month of April will also be watched next week, while Japan will release its preliminary estimates for GDP growth of Q1-2026 and industrial production for March. The Eurozone's inflation for April will also be watched.

Indian Rupee

On the home front, the market participants will keep an eye on the Indian rupee, which fell to a fresh all-time intraday low of 96.14 against the US dollar before ending at a new closing low of 95.96 with 1.57 percent depreciation, pressured by rising crude oil prices, which continue to weigh on import costs and inflation concerns. This was after the 0.43 percent gains in the previous week. The currency has weakened by 5.4 percent since the start of the US, Israel, and Iran war.

FII Flow

The focus will also be on the mood at Foreign Institutional Investors (FIIs), which caused pressure not only in the currency pair but also in equities. FIIs have net bought around Rs 1,500 crore in the last two days, but overall, net sold around Rs 13,600 crore worth shares in the week ended May 15, taking the net outflow in the current month to Rs 24,600 crore and in the year to Rs 2.65 lakh crore of selling.

Corporate Earnings

The March quarter earnings season will be in full swing as it approaches the end. Nearly 700 companies are set to release their quarterly earnings scorecard in the coming week, including prominent names from the Nifty 50 like Bharat Electronics, ITC, and Sun Pharmaceutical Industries. Grasim Industries, NTPC, Eicher Motors, Hindalco Industries, and Apollo Hospitals Enterprise.

Domestic Economic Data

Economic releases like infrastructure output for April and HSBC Manufacturing & Services PMI flash for May will also be watched next week. Manufacturing PMI rose to 54.7 percent in April from 53.9 percent in the same period, while Services PMI jumped to 58.8 percent from 57.5 percent in the same period.

At the close on Friday (May 15), the total market cap of all BSE Sensex companies stood at Rs 4,60,59,270.