The Indian equity markets started cautiously following a significant rally in the previous session, with benchmark indices declining due to investor worries about escalating geopolitical tensions. Reports indicating an attack by Israel on Lebanon’s Hezbollah raised concerns about a potential disruption in the Strait of Hormuz. Sensex traded 560 points lower at 77,003, while Nifty fell by 182 points to 23,815, with sectors like IT, realty, banking, and auto stocks experiencing declines.
Among the Nifty pack, top losers included Infosys, Shriram Finance, HCL Tech, Bajaj Finance, IndiGo, Tech Mahindra, Axis Bank, and M&M. Analysts advised traders to be cautious, suggesting a ‘buy on dips’ strategy near support levels and recommending against aggressive long positions at higher levels. They highlighted the significant role of the ongoing divergence between foreign and domestic flows in maintaining market stability.
Analysts also observed that India VIX had decreased to around 19.69, indicating reduced volatility, although some intraday swings might still occur. Institutional flows showed a contrast, with FIIs being net sellers of about Rs 2,812 crore, while DIIs continued strong buying with inflows of around Rs 4,168 crore. Brent crude futures surged by 3.31% to $97.89 per barrel, and US West Texas Intermediate (WTI) crude traded at $98.38, up by 4.2% from the previous close.
Asian stocks traded lower, with the Nikkei, Hang Seng, and KOSPI down by 0.77%, 0.17%, and over 1%, respectively. In the US, Wall Street closed higher, with major indices ending more than 2% up.
