# Cash Derivatives Volumes Drop as Oil Yields Impact Markets

> Oil prices and bond yields drive Indian stock market volatility.
- Title: Cash Derivatives Volumes Drop as Oil Yields Impact Markets
- Summary: Oil prices and bond yields drive Indian stock market volatility. Indian stock market volumes fell 11.7% in Q2 due to rising oil prices and foreign outflows.
- Keywords: nifty, oil prices, bond yields, foreign portfolio investors, sebi, rbi, cash market, derivatives, market volatility, indian equities, money, business
- Source: mint — https://livemint.com/market/cash-derivatives-volumes-sink-as-oil-yields-roil-sentiment-11791100948351.html
- Author: Ram Sahgal
- Published: 2026-10-05T00:21:02+00:00
- Read time: 1 min
- Topics: nifty, oil prices, bond yields, foreign portfolio investors, sebi, rbi, cash market, derivatives, market volatility, indian equities, money, business
## Market Activity Declines
Trading activity in Indian stock markets fell sharply in the September quarter with volumes in both cash and derivatives segments declining.
## Cash Volumes Drop 11.7%
The combined average daily equity cash volume of NSE and BSE fell 11.7% sequentially to ₹ 1.29 trillion in July-September.
## Derivatives Volumes Drop 27%
The combined average daily index-options premium volume fell by 27% to ₹ 63,326 crore over the same period.
## Oil Prices Surge
Brent crude rose 34% to $98 a barrel during the September quarter after sliding 38% to $73 a barrel in the June quarter.
## Foreign Investors Sell
Foreign portfolio investors sold ₹ 1.38 trillion of Indian equities in the fiscal year through 1 October after a record ₹ 1.8 trillion of selling in fiscal year 2026.
## Bond Yields Rise
The yield on the benchmark 10-year Indian government bond rose 43 basis points to 7.18% during the September quarter.
## Regulatory Pressures
RBI's funding curbs on proprietary traders and Sebi's new closing auction session have dented domestic participation in both cash and derivatives markets.
## Market Analysts Divide
Analysts remain divided on volume recovery, with some expecting options volumes to pick up if Sebi defers CAS for derivatives settlements on weekly expiry days.
## Key takeaway

Indian stock market volumes fell 11.7% in Q2 due to rising oil prices and foreign outflows.