Domestic equity markets started the week on a downward trend due to escalating tensions in West Asia and rising crude oil prices. The Sensex dropped by 1,555.62 points to 72,977.34, while the Nifty fell by 479.95 points to 22,634.55 in early trading. Sectors like metal, PSU banks, and auto witnessed significant declines of up to 3%, with stocks such as Tata Steel, Hindalco Industries, and HDFC Bank being among the top losers.
Market sentiment turned cautious as the US-Israel-Iran conflict continued without signs of de-escalation, causing concerns about prolonged geopolitical instability. Oil prices surged, with Brent crude nearing $113 per barrel and US WTI crude rising over 3%, leading to global inflationary pressures. The Strait of Hormuz, a crucial oil shipping route, faced disruptions, further adding to investor worries.
Analysts noted a shift to a risk-off phase in the markets due to heightened geopolitical uncertainties and elevated oil prices. They highlighted the weak global cues, increased volatility, and ongoing foreign institutional investor selling as factors impacting sentiment. Market experts suggested that the Nifty faces pressure, with support expected around 22,800 levels and resistance in the 23,400–23,600 range.
Investor caution was advised amidst the market volatility, with recommendations to focus on accumulating fundamentally strong stocks during declines. Foreign institutional investors remained net sellers, while domestic institutional investors provided some stability. Major Asian indices, including Japan’s Nikkei 225, Hong Kong’s Hang Seng, and South Korea’s Kospi, witnessed significant declines, mirroring the negative sentiment in the US markets.
