The Indian equity markets staged a resilient recovery on Friday, February 20, 2026, recouping a portion of the previous session's steep losses. The Sensex climbed 316.57 points while the Nifty 50 managed to close above the crucial 25,550 mark.

Despite a cautious start triggered by escalating U.S.-Iran tensions and high crude oil prices, broad-based buying in heavyweights like Hindalco, NTPC and L&T, supported by positive news from the India AI Impact Summit, offset continued weakness in the IT sector, allowing both benchmark indices to end the week with marginal gains.

The barometer index, the S&P BSE Sensex rose 0.38% to settle at 82,814.71. The Nifty 50 index rose 116.90 points or 0.46% to close at 25,571.25.

Hindalco Industries (up 3.21%), NTPC (up 2.64%) and Larsen & Toubro (up 2.33%) boosted the Nifty higher today.

In the broader market, the BSE 150 MidCap Index added 0.44% and the BSE 250 SmallCap Index shed 0.19%.

The market breadth was negative. On the BSE, 1,917 shares rose and 2,265 shares fell. A total of 169 shares were unchanged.

Economy:

HSBC India Services PMI eased to 58.4 in February 2026 compared with 58.5 in January 2026, with exports rising fastest since August 2025, domestic demand easing, modestly faster hiring, and input costs hitting a 2.5-year high. Selling prices and business sentiment rose to a one-year peak.

HSBC India Manufacturing PMI climbed to 57.5 in February 2026 compared with 55.4 in January 2026, led by strong domestic demand, modest export growth, higher employment, inputs, and inventories. Input and output prices rose, while sentiment remained positive.

HSBC India Composite PMI hit 59.3 in February 2026 as against 58.4 in January 2026, the highest since last November, as factory output, new orders, and foreign sales strengthened. Hiring improved, input costs rose to a 15-month high, selling prices to a six-month peak, and sentiment reached a one-year high on investment optimism.

India AI Impact Summit 2026:

The AI Impact Summit, held from February 16'20, brought together over 500 global AI leaders, 150 academicians and researchers, and 400 chief technology officers, vice-presidents, and philanthropists.

The Pax Silica declaration was signed between India and the US. The US Ambassador Sergio Gor said: It is an honour to stand before all of you at this historic moment as we welcome India into Pax Silica. What struck me most was not just India's scale, although that is breathtaking'it is India's resolve, the determination to chart your own course.

I keep talking about the limitless potential between our two nations, and I truly mean it. From the trade deal to Pax Silica to defence cooperation, the potential for our two nations to work together is truly limitless. I aim to fulfill that over the next three years that I'm here.'

Maharashtra CM Devendra Fadnavis spoke at the India AI Impact Summit, highlighting the state's achievements in technology. He emphasized that AI is designed to benefit farmers.

Numbers to Track:

The yield on India's 10-year benchmark federal paper rose 0.73% to 6.723 compared with the previous session close of 6.674.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 90.9525 compared with its close of 90.6850 during the previous trading session.

MCX Gold futures for 2 April 2026 settlement added 1.06% to Rs 156,441.

The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.07% to 97.91.

The United States 10-year bond yield fell 0.15% to 4.071.

In the commodities market, Brent crude for April 2026 settlement lost 41 cents or 0.57% to $71.25 a barrel.

Global Markets:

European markets traded higher on Friday, supported by upbeat U.K. retail sales, stronger Eurozone PMI readings, and easing inflation, which lifted growth sentiment and reinforced expectations of a supportive policy backdrop.

The HCOB Eurozone Composite PMI rose to 51.9 in February, the strongest since November, driven by gains in manufacturing and services, though new orders remained soft and input costs accelerated.

Asian markets ended mixed, after all three major Wall Street indexes declined overnight, pressured by a drop in private credit stocks and Iran-U.S. tensions.

Prospects of a strike on Iran have risen with U.S. President Donald Trump reportedly saying that he would take a call to decide on military action against Tehran in the next 10 days. This pushed Brent Crude higher, gaining 0.26%, to settle at $71.92.

In Asia, investors assessed Japan's latest inflation data. The island nation's headline inflation rate fell from 2.1% in December to 1.5% in January, its lowest level since March 2022. The reading ended a run of 45 straight months in which inflation had remained above the Bank of Japan's 2% target.

The core inflation rate, which excludes fresh food prices, eased to 2%, the lowest level since January 2024. It was down from 2.4% in December.

As per reports, despite the slowdown in headline inflation, the Bank of Japan is unlikely to delay rate hikes as fresh-food prices remain volatile, while energy costs fell after Japan scrapped its fuel tax in December.

Overnight on Wall Street, the US stocks closed lower on Thursday, pulling the S&P 500 close to flat for the year, as investors rotated out of financials and monitored escalating tensions between the US and Iran.

The Dow Jones Industrial Average fell 267.50 points, or 0.54%, closing at 49,395.16. The S&P 500 declined 0.28%, ending at 6,861.89, while the Nasdaq Composite slipped 0.31% to 22,682.73.

Financial stocks led the decline after Blue Owl Capital said it would tighten investor liquidity following the sale of $1.4 billion in loan assets, raising concerns about potential losses in the private credit market. Shares of Blue Owl dropped about 6%, while Blackstone and Apollo Global Management each fell more than 5%.

Software stocks also remained under pressure amid persistent worries about artificial intelligence disruption. The sector has struggled in recent weeks as investors assess how AI could reshape enterprise software demand.

Stocks in Spotlight:

Shares of Novartis India hit an upper circuit of 20%. The company's Swiss parent, Novartis AG, announced the sale of its entire 70.68% stake in the listed Indian arm for about Rs 1,446 crore to a consortium of investors.

Novartis AG has entered into a share purchase agreement to divest 1,74,50,680 equity shares, representing 70.68% of the company's paid-up equity capital, to a consortium led by WaveRise Investments, ChrysCapital Fund X, and Two Infinity Partners, along with persons acting in concert, ChrysCapital X, LLC, and OceanEdge Investments. The proposed acquisition has triggered a mandatory open offer to acquire up to 26% of the voting share capital from public shareholders.

ABB India rallied 4.72%. The company has reported 5.82% jump in consolidated net profit to Rs 432.85 crore as revenue from operations rose by 7.44% to Rs 3,557.01 crore in Q4 CY25 over Q4 CY24.

Dee Development Engineers rallied 13%. The company received has letter of intent for supply of heat recovery steam generator (HRSG) pipes from one of the largest international OEM based in US.

CIE Automotive India rose 1.68%. The company has reported a 10.4% rise in consolidated net profit to Rs 204.31 crore on a 13.4% increase in net sales to Rs 2,393 crore in Q4 2025 as compared with Q4 2024.

Zydus Lifesciences rose 0.08%. The company said the US Food and Drug Administration (USFDA) has completed a pre-approval inspection (PAI) at its Injectable Medical Devices facility in Ahmedabad with nil observations.

Pace Digitek added 2.82%. The company has secured an order worth Rs 890.69 million from RailTel Corporation of India (RCIL) for the supply, installation and commissioning of IP-based video surveillance systems in LHB coaches.

IFGL Refractories rose 0.20%. The company announced that a new line for manufacturing of plastic refractories at the company's Visakhapatnam manufacturing facility has commenced commercial operations.

IPO Update:

Gaudium IVF and Women Health received bids for 1,26,56,385 shares as against 1,46,20,340 shares on offer, according to stock exchange data at 16:40 IST on Friday (20 February 2026). The issue was subscribed 0.87 times.

The issue opened for bidding on 20 February 2026, and it will be close on 24 February 2026. The price band of the IPO is fixed between Rs 75 and 79 per share.

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