Indian markets extended their losses in early afternoon session tracking a weak trend in global peers. Traders were worried by the lack of meaningful progress in resolving the ongoing US-Iran conflict. Besides, rising crude oil prices also dampened the investors’ sentiments. Traders took note of the Organisation for Economic Cooperation and Development’s (OECD) interim Economic Outlook projecting that India's Gross Domestic Product (GDP) to grow at 7.6 per cent in the current fiscal year 2025-26 (FY26). It said the decline in (US) tariffs should support growth in India, though gas rationing will disrupt some production activities and fiscal support is expected to fade, with growth easing from 7.6 per cent in FY26 to 6.1 per cent in FY27 and 6.4 per cent in FY28.  On the global front, Asian markets were trading mixed as traders remain concerned about the economic impact of the expanding conflict in the Middle East. 

The BSE Sensex is currently trading at 74012.21, down by 1261.24 points or 1.68% after trading in a range of 73960.45 and 74904.91. There were 3 stocks advancing against 27 stocks declining on the index.

The only gaining sectoral indices on the BSE were IT up by 0.19% and TECK was up by 0.04%, while Auto down by 2.79%, Realty down by 2.65%, Bankex down by 2.32%, Consumer discretionary down by 2.13% and Industrials was down by 2.04% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 1.47%, Sun Pharma up by 0.39% and Power Grid up by 0.24%. On the flip side, Interglobe Aviation down by 4.35%, Reliance Industries down by 3.90%, Bajaj Finance down by 3.61%, Mahindra & Mahindra down by 3.03% and Bajaj Finserv down by 3.01% were the top losers.

Meanwhile, government of India has retained the inflation target for second consecutive period, and asked the Reserve Bank of India (RBI) to maintain retail inflation at 4% with a margin of 2% on either side for another five years ending March 2031. In 2016, India has adopted the inflation-targeting framework in order to control the price rise, and formally tasked the central bank to keep the retail inflation with in the target range. Subsequently, in March 2021, the government maintained the same target. Over the past decade, inflation has stayed within the mandated band for roughly three-quarters of the time, with volatility peaking during the pandemic years. In February 2026, retail inflation in the country increased to 3.21% from 2.74% in the preceding month. The Consumer Price Index (CPI) released earlier this month is based on the new series with a base year of 2024.  

The RBI Governor-headed six-member Monetary Policy Committee (MPC) determines the policy rate required to achieve the inflation target. Further, against the backdrop of the next review of the target to be effective from April 1, 2026, and the significant changes in the global and domestic economic environment, the RBI said it has undertaken a review of the nature and format of the inflation target. For this, the central bank came out with a discussion paper in August 2025 seeking feedback from stakeholders on four questions.

The discussion paper said the inflation performance over the nine years of flexible inflation targeting (FIT) witnessed a hump-shaped performance, with the first three years and the last three years remaining aligned to the target. The middle three years showed an inclination towards the upper tolerance band, confronted with a once-in-a-century pandemic, followed by the Russia-Ukraine conflict that drove up the inflation trend worldwide during this period. It added that the inflation levels have seen a distinct decline with the average since the adoption of FIT at 4.9%, vis-a-vis an average of 6.8% over the pre-FIT period in the current series.

The central bank stressed that the conduct of monetary policy frameworks needs both policy certainty and credibility. It noted that policy certainty and credibility have become particularly important during the current environment of heightened uncertainty, therefore, it is important that the basic tenets of the framework that have been tested and judged to be favourable are continued. It added that the adaptability and flexibility already inbuilt into the extant framework should be leveraged to nudge the economy towards further improved macroeconomic outcomes.

The CNX Nifty is currently trading at 22934.35, down by 372.10 points or 1.60% after trading in a range of 22917.20 and 23186.10. There were 8 stocks advancing against 42 stocks declining on the index.

The top gainers on Nifty were ONGC up by 3.70%, TCS up by 1.60%, Wipro up by 1.00%, Nestle up by 0.60% and Sun Pharma up by 0.37%. On the flip side, Shriram Finance down by 5.07%, Tata Motors Passenger down by 5.00%, Interglobe Aviation down by 4.42%, Reliance Industries down by 3.93% and Bajaj Finance down by 3.69% were the top losers.

Asian markets were trading mixed; Taiwan Weighted lost 225.03 points or 0.68% to 33,112.59, Nikkei 225 slipped 209.65 points or 0.39% to 53,394.00, Jakarta Composite plunged 63.09 points or 0.89% to 7,101.00 and KOSPI was down by 21.59 points or 0.4% to 5,438.87. On the flip side, Shanghai Composite strengthened 24.78 points or 0.63% to 3,913.86, Straits Times rose 25.06 points or 0.51% to 4,912.82 and Hang Seng was up by 155.57 points or 0.62% to 25,012.00.