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Below the Quote on Daily Market Commentary for May 26nd 2026 By Siddhartha Khemka, Motilal Oswal Financial Services Ltd

A gradual up-move in domestic markets could continue if crude oil prices remain soft and concerns surrounding global energy supplies continue to ease. However, investor sentiment is likely to remain cautious as mixed signals emerging from the ongoing US-Iran negotiations, along with recent US strikes on Iran, continue to keep geopolitical risks elevated across global financial markets. Concerns over prolonged supply disruptions and delays in normalising shipping flows through the Strait of Hormuz IS keeping energy markets highly sensitive to every geopolitical development. On Tuesday, the Nifty remained volatile throughout the session and slipped below the 24,000 mark to close at 23,913 (-0.5%) amid monthly F&O expiry, profit booking at higher levels and mixed global cues. However, weakness in the benchmark index was partially cushioned by strength in metal and auto stocks. Notably, FIIs turned net buyers on Monday after sustained selling in recent sessions, providing some support to overall market sentiment. Broader markets continued to outperform, with the Midcap100 and Smallcap100 indices gaining 0.6% and 0.4%, respectively. Despite volatility in frontline indices, the Nifty Midcap100 index surged to a fresh all-time high of 62,365, supported growth-oriented stocks such as Adani Total Gas, Exide Industries, Naukri, KPIT and JSW Energy. The resilience in broader markets despite prevailing global uncertainties reflects sustained domestic liquidity participation. Sectorally, Nifty metals outperformed during the session, while Consumer Durables and Private Banks emerged among the top laggards. Meanwhile, elevated crude oil prices over the past two weeks have led to multiple hikes in petrol, diesel and CNG prices, with petrol and diesel prices cumulatively increasing by nearly Rs 8–10/litre in several cities, while CNG prices in Delhi have risen to around Rs 83/kg after successive Rs 2/kg hikes. The sustained rise in fuel prices has increased transportation and operating costs across industries and intensified concerns around imported inflation. Fuel-intensive sectors such as aviation, paints, chemicals, logistics and cement are expected to remain under pressure due to rising input costs, while oil marketing companies may continue to face margin pressure if crude oil prices remain elevated. Overall, markets continue to remain resilient despite elevated global uncertainty, supported by strong domestic liquidity and selective buying in broader markets. However, persistent geopolitical tensions in West Asia, inflationary concerns and mixed signals from the ongoing US-Iran negotiations are likely to keep investor sentiment cautious and market volatility elevated in the near term.

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