Stock markets in India bore the brunt of escalating tensions in the Middle East on Monday, as benchmark indices recorded a steep fall during early trade. The Sensex tumbled by more than 850 points while the Nifty 50 dropped below the crucial 25,000 mark, with losses extending across all major sectors.
The slide followed a weekend marked by United States airstrikes on Iranian nuclear facilities, raising fears of an intensifying conflict between Iran, Israel, and the US. The geopolitical tremors pushed Brent crude oil prices above $80 per barrel — a level not seen in over five months.
At 09:58 AM, the BSE Sensex was down 850 points, while the Nifty hovered below 25,000, with Information Technology, Banking, FMCG, and Auto stocks all showing sharp declines. IT shares led the losses, weighed down further by Accenture’s report of a third straight year-on-year drop in outsourcing deals.
“The rising uncertainty over the Middle East has triggered a global sell-off,” said analysts tracking the early session. “Concerns around oil-led inflation and the potential delay in interest rate cuts by the US Federal Reserve are adding to the nervousness,” they added.
Nifty IT index dropped more than 1 per cent, while other sectoral indices – including Nifty Bank, Financial Services, Auto, FMCG, and Consumer Durables – opened 0.5 to 1 per cent lower. Infosys, HCL Technologies, and TCS were among the top laggards in the tech space.
The forex market also mirrored the jittery sentiment. The rupee depreciated by 20 paise in early trade, settling at ₹86.75 against the US dollar. Traders attributed this to rising dollar demand amid global uncertainty.
Also read: Oil prices jump over 2%, Asian markets plunge as US attacks Iran
Bond markets, too, felt the impact of oil shock fears. Yields on benchmark 10-year government securities were expected to inch higher, with traders estimating a range of 6.32% to 6.35%, compared to the previous close of 6.3087%.
Adding to the cautious mood, companies such as Tata Capital Housing Finance and Poonawalla Fincorp announced bond issues to raise a combined ₹31 billion, suggesting a preference for locking in funds before further rate volatility.
Despite Friday’s rally, Monday’s gap-down opening was widely expected by analysts after the sharp escalation in US-Iran hostilities. The prospect of Iran closing the Strait of Hormuz—a key oil shipping channel—has further unnerved investors.
In contrast to the red tide in Asia, Tel Aviv’s benchmark index surged to record highs following US strikes, as investors there appeared to interpret the attacks as a temporary setback to Iran’s nuclear ambitions.
Among individual stocks, Timescan Logistics, Shipping Corporation of India, and Gujarat Pipavav Port saw gains, while Astral Ltd., Supreme Industries, and Suven Life Sciences led the losers’ pack.
The week ahead may see sustained volatility in Indian equities, particularly if geopolitical tensions worsen or crude prices cross key resistance levels.
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