Indian equity markets are likely to start the new financial year (2026-27) on a positive note, tracking a strong rally in global markets amid hopes of an end to the US-Iran war in the Middle East. However, some cautiousness may come as exchange data showed Foreign Institutional Investors (FIIs) remained net sellers for the 21st consecutive trading session on Monday, selling shares worth Rs 11,163 crore. Markets remained closed on Tuesday on account of Mahavir Jayanti holiday. 

Some of the key factors to be watched:    

India’s industrial output grows 5.2% in February: The Ministry of Statistics & Programme Implementation, in its latest report, has showed that Index of Industrial Production (IIP) recorded a 5.2% (Quick Estimate) year-on-year growth in February 2026, which is slightly higher than 5.1% growth in the month of January 2026. 

India’s GDP growth to moderate to 6.5% in FY27: ICRA said it estimates India's GDP growth to moderate to 6.5 per cent in 2026-27, from 7.6 per cent in the current fiscal year owing to the adverse impact of elevated energy prices and concerns around energy availability amid the West Asia conflict.

India's fiscal deficit reaches 80.4% of full year target in April-February of FY26: The data released by the Controller General of Accounts (CGA) showed the Centre's fiscal deficit stood at Rs 12.52 lakh crore at the end of February, or 80.4 per cent of the annual budget target for 2025-26 compared to 85.8 per cent in the year-ago period. 

Industry credit rises 13.5% in February: The Reserve Bank of India (RBI) data showed bank credit to industry grew at faster pace of 13.5 per cent on the fortnight ending February 28, compared with 7.5 per cent in the year-ago period. 

RBI extends export credit relief amid West Asia crisis: The RBI has extended the enhanced export credit period of up to 450 days for pre-shipment and post-shipment finance for disbursals made till June 30, citing continued logistical disruptions due to the ongoing West Asia crisis. 

On the global front: The US markets ended in green on Tuesday lifted by speculation about a potential de-escalation in the Middle East conflict that has sent oil prices soaring and fueled fears of global inflation in recent weeks. Asian markets are trading in green on Wednesday following the broadly positive cues from Wall Street overnight. 

Back home, declining for the second day in a row, Indian equity benchmarks ended with losses of over two percent on Monday as the ongoing war in West Asia and surging crude oil prices kept investors' sentiment fragile. Weak trends in Asian markets and unabated foreign fund outflows also added to the bearish trend in domestic equities. Finally, the BSE Sensex fell 1635.67 points or 2.22% to 71,947.55 and the CNX Nifty was down by 488.20 points or 2.14% to 22,331.40. 

Some of the important factors in trade: 

Near-term outlook remains uncertain: The Finance Ministry said that the near-term outlook remains uncertain, with external shocks particularly the West Asia crisis posing downside risks to growth through elevated input costs and potential supply disruptions. 

Unemployment dips marginally to 3.1% in 2025: A government survey stated that the overall unemployment rate for persons aged 15 years and above in India declined marginally to 3.1 per cent in January to December 2025 from 3.2 per cent a year ago. 

Centre to borrow Rs 8.2 lakh crore in H1 FY27: The finance ministry has said that the Centre is planning to mobilise Rs 8.20 lakh crore through issuance of dated securities, including Rs 15,000 crore of Sovereign Green Bonds during the April-September period of 2026-27.