Mumbai, May 6, 2026, 13:43 IST
- Indian benchmarks started strong but lost ground as profit-taking knocked large caps. The Nifty hovered close to 24,000.
- The government’s new credit-guarantee scheme gave banks and airlines a lift, targeting companies impacted by the West Asia crisis.
- FMCG and oil-and-gas shares slipped, but mid- and small-caps pushed ahead.
Indian stocks lost early steam on Wednesday. The Sensex, after leaping more than 600 points out of the gate, slipped into the red by early afternoon, down 177.82 points, or 0.23%, at 76,846.72 as of 1:00 p.m. The Nifty 50, meanwhile, drifted near the 24,000 mark—off 9.45 points at 24,014.45 at that same hour. Later, NSE data showed the Nifty rebounding a bit, up 45 points to 24,077.80, as of 1:23 p.m.
This matters for India because its market is being squeezed by two opposing forces: the lift from cheaper crude and uncertainty over how long that window stays open. Brent slid to around $108 a barrel on renewed U.S.-Iran peace chatter, but profit-takers moved in while the street waited for firmer signals out of Tehran and Washington.
Late Tuesday, the Union Cabinet signed off on Emergency Credit Line Guarantee Scheme 5.0, opening the door for banks to extend more loans under a government-backed guarantee. Put simply, New Delhi is stepping in to shoulder part of the risk if borrowers default—aiming to unleash ₹2.55 lakh crore in fresh credit. Of that, ₹5,000 crore is earmarked specifically for airlines. The plan gives a full 100% guarantee on loans to MSMEs, while non-MSMEs and airlines get 90% coverage.
Information and Broadcasting Minister Ashwini Vaishnaw described the scheme as a response to pressure on MSMEs and aviation triggered by the West Asia conflict, saying the framework leaves “very less probability” for misuse. Under the plan, most borrowers face a cap on extra credit at 20% of their highest working-capital use during the March quarter of FY26. Airlines can access more, if they meet certain requirements. The Indian Express
Banks moved up first. Both private and state-backed lenders advanced following the credit plan, according to Reuters. Nomura analysts described the move as a “net positive for banks,” saying it may boost loan growth and ease short-term asset-quality concerns. Reuters
Airline stocks caught a lift alongside the policy-driven rally. Shares of InterGlobe Aviation, which runs IndiGo, climbed up to 3.58%. SpiceJet, for its part, surged right to its 5% upper circuit after the government approved a credit-line guarantee scheme aimed at airlines and related businesses.
Underneath the index numbers, the market was firmer. As of 12:47 p.m., advancers led decliners by 2,182 to 1,528, with the broader indices tacking on roughly 1%. Nifty Pharma posted a 1.7% gain. Nifty FMCG dropped 0.6%, Nifty Energy slipped 0.5%.
Earnings did some lifting in spots. Hero MotoCorp climbed after topping profit forecasts for the March quarter. Mahindra & Mahindra added to its rally after a profit beat of its own. Coforge surged, clocking a quarterly profit jump of over 100%.
Larsen & Toubro dragged on the session, down as much as 3.8% after quarterly profit slipped 3.1%. The company flagged that turmoil in the Middle East might weigh on revenue momentum. HSBC Global Investment Research called out “near-term growth and margin risks persist.” Reuters
Foreign money is still the main drag. Overseas funds have yanked ₹1.98 lakh crore out of Indian stocks across the first four months of 2026, with another ₹5,052 crore offloaded in May so far, NSDL data reported by Mint shows. For Sugandha Sachdeva of SS WealthStreet, any turnaround depends on West Asia calming down, oil prices cooling off, and a pick-up in global risk appetite.
The trade remains on shaky ground. VK Vijayakumar, chief investment strategist at Geojit Investments, pointed to markets tracking war updates and oil price jolts, adding that investors are likely to tread carefully on any new U.S.-Iran comments.
At 24,250, the ceiling held firm; traders weren’t budging. Dhupesh Dhameja, who covers derivatives at SAMCO Securities, flagged that the Nifty stayed locked in a 23,750–24,250 band, with most sticking to a “sell-on-rise” stance—unless that upper barrier cracks. Moneycontrol
