Namaskar,

Welcome to the fourth Chai & Charts. The Nifty rose 2.8% this week, its best week in six months, helped by a sharp rally in IT shares after their July–September results. The rupee had its best week in seven months too.

Not everything was rosy. Inflation rose at home and in the US, bond yields touched three-year highs, foreign investors kept selling, and mid and small caps lagged the big names. Let's get into it.

Nifty 50, daily change (%)

Global markets & metals

1. IT results lifted India while global tech shares fell

Large IT companies reported July–September results that were better than expected, with managements pointing to growing revenue from AI-related work. The Nifty IT index rose 11.7% over the week, its biggest weekly gain since 2008, and 12 of 16 major sectors ended the week higher (Reuters). Elsewhere the mood was very different: in the US, technology and AI-linked shares sold off after a hotter inflation report, and the Nasdaq 100 fell 2.6% in the week to Thursday. Reuters said the global AI sell-off prompted value-buying in other shares, even as a broad index of Asia-Pacific markets outside Japan fell 5.8% over the week.

2. Inflation rose, yields hit three-year highs and the rupee recovered

India's retail inflation rose to 5.54% in September, a 21-month high, with food inflation at 7.74% (Ministry of Statistics data). Wholesale inflation climbed to 11.39% from 9.92% in August. The 10-year government bond yield, at 7.30% last Friday, touched about 7.4% early in the week, its highest in over three years, and was about 7.37% on Thursday, as the RBI announced a ₹25,000 crore bond sale and asked banks to keep more cash with it each day. The rupee, meanwhile, had its best week in seven months. After the RBI's measures of 10 October (a special dollar window for the three state-run oil companies and tighter rules on currency hedging), it rose for six days in a row to a provisional 94.92 per dollar on Friday, from 96.72 a week earlier. Brent crude stayed high, at about $105 a barrel on Friday. RBI data showed foreign exchange reserves fell by $8.58 billion to $726.03 billion in the week ended 9 October.

3. Foreign investors sold; SIPs hit a new high

Foreign investors were net sellers of Indian shares on every day from Monday to Thursday, about ₹10,156 crore in all, including ₹5,285 crore on Thursday alone (provisional exchange data). That takes the provisional total for 1–15 October to about ₹49,935 crore. Domestic institutions bought about ₹51,829 crore over the same period. Friday's figures were not available when we finalised this issue. On the other side, AMFI data show monthly SIP contributions reached a record ₹32,490 crore in September, even as total mutual fund assets fell 5.1% during the month to ₹82.64 lakh crore.

Gold fund-of-funds: fresh investments paused (fund house notices · from 15–16 October · temporary)

Several fund houses, 17 according to media reports, have temporarily stopped fresh money into their gold ETF fund-of-funds. Lump sums, switch-ins, new SIPs and STPs and SIP top-ups are on hold. SIP instalments registered before the cut-off generally continue, and existing units, redemptions and switch-outs are not affected. Some notices refer to directions from SEBI, but no public SEBI circular had been issued by Friday, and no end date has been given. If you have questions about how this affects your own investments, please call us.

SEBI: F&O expiry settlement stays on the 30-minute average (final · circular dated 15 October · from 7 December 2026)

SEBI has dropped its plan to settle expiring futures and options at the price from the end-of-day closing auction. They will continue to settle at the volume-weighted average price of the last 30 minutes of trading. The circular also changes the closing auction timings and lets stock derivatives trade until 3:45 pm. Most changes apply from 7 December 2026, the rest from 8 February 2027. This mainly concerns traders in futures and options.

RBI: steps to support the rupee and tighten cash (final · announced 10 October · in force)

The RBI is now supplying the full daily dollar needs of the three state-run oil companies directly from 12 October, cut the limit for some currency hedges without supporting documents from $100 million to $5 million, and asked banks to keep a 20% cash reserve against certain large dollar-buying contracts. Separately, from 16 October banks must keep 99% (earlier 90%) of their required cash reserve with the RBI every day.

Tax: open to views on capital gains tax (remarks · 13 October · no change made)

The Finance Minister said the government will hear views on how investments are taxed, including long-term capital gains, as preparations for Budget 2027 begin. Nothing has been proposed and the current rules have not changed. For your own tax position, please speak to your CA.

A sector index rising almost 12% in five days makes headlines. Big moves like this are worth understanding, and worth keeping in proportion:

• The index and your portfolio are not the same thing. This week the Nifty rose 2.8%, but mid caps barely moved and small caps slipped. How your own investments did depends on what you hold.
• Beware the urge to follow last week's winner. It is natural to want more of whatever just did well. A plan built on what rose most last week tends to keep changing direction, and nobody knows which corner of the market will do well next.
• Spreading your money is a plan for not knowing. Holding a mix of investments in line with your goals and risk profile means you are not relying on any single sector or market having a good week.
• Talk before you act. If this week's moves have you thinking about changing your investments, call us first and we'll go through your plan together.

This issue starts tracking US markets, and the note under that table says the rupee also matters. Here is why. US shares are priced in dollars. For an Indian investor, the return in rupees depends on two things: how much the investment moved in dollars, and how much the dollar moved against the rupee in the same period. The rupee price of a dollar was 96.72 last Friday and about 94.92 this Friday, so the dollar became about 1.9% cheaper in rupees in a single week.

The two moves multiply rather than simply add, but adding them gives a close rough answer:

That's all for this week. If you'd like to talk about anything here, just reply to this email or message us on WhatsApp. And if a friend or family member would find this useful, please forward it to them.

Warm regards,

Aniruddha Samdani
AMFI-registered Mutual Fund Distributor · ARN-66087
www.asfinserv.co

Data sources: NSE and BSE closing data, 12–16 Oct 2026 (via Business Standard, HDFC Sky, Kotak Neo, 5paisa); weekly change, sector and breadth data, Asia-Pacific index (Reuters via Business Recorder, 16 Oct 2026); Nifty IT weekly move (Reuters; 5paisa, 16 Oct 2026); Nasdaq 100 closes, 8 and 15 Oct 2026 (Nasdaq Global Indexes; Investing.com; Yahoo Finance); S&P 500 closes, 8 and 15 Oct 2026 (AP via Yahoo Finance and La Nación); IBJA 999 gold and silver AM rates, 9 and 16 Oct 2026 (IBJA via 5paisa and Goodreturns; ibjarates.com), cross-checked with MCX futures (Angel One, 9 Oct; Goodreturns and Punjab Kesari, 16 Oct 2026); US 10-year yield (Strategitz market close; Yahoo Finance, 15 Oct 2026); India 10-year yield (Kotak Neo, 12 Oct; Trading Economics, 12–15 Oct 2026); retail inflation (Ministry of Statistics, September 2026, via Business Today, IndexBox); wholesale inflation (Ministry of Commerce and Industry, via Kotak Neo, Devdiscourse, 14 Oct 2026); US consumer prices (US Bureau of Labor Statistics, via CBS News, Yahoo Finance, 14 Oct 2026); RBI measures (10 Oct 2026, via Business Standard, Business Today); rupee closing rates (PTI via HDFC Sky, Telangana Today, 16 Oct provisional; Reuters); Brent crude (Business Standard; PTI, 16 Oct 2026); foreign exchange reserves (RBI, week ended 9 Oct 2026, via ThePrint/PTI); FII and DII daily data (provisional exchange data via 5paisa, Tapetide, Quantsapp, PTI, 1–15 Oct 2026); AMFI monthly data (September 2026, via Zee Business, The Statesman); gold fund-of-funds notices (Angel One, Creso, 15–16 Oct 2026); SEBI circular on closing auction session and derivatives settlement (15 Oct 2026, via Outlook Money, Outlook Business); Finance Minister's remarks (13 Oct 2026, via Business Standard, All India Radio News); US Federal Reserve meeting calendar (via CBS News); NSE holiday list (via ClearTax, Kotak Neo); RBI MPC schedule. All figures are as of the dates mentioned and may be revised by the source.

Disclaimer: This newsletter is for general information and investor education only. It is not investment, tax or legal advice, and it does not recommend buying, selling or holding any security, mutual fund scheme, gold or silver product, overseas investment or insurance product. Views on markets are general and do not take into account any individual's objectives, financial situation or needs. Illustrations use assumed figures and are not forecasts. Aniruddha Samdani Finserv is an AMFI-registered Mutual Fund Distributor (ARN-66087) and may earn commission on mutual fund investments made through it. Please consult your tax consultant/CA on tax matters.

SIP does not guarantee a profit or protect against loss in declining markets.

Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing. Past performance is not indicative of future results.