Stock markets opened lower on Friday asand rising crude oil prices continued to weigh on investor sentiment. The decline came just a day after the benchmark indices had recorded gains, showing how volatile the market has become in recent sessions.
The S&P BSE Sensex was down 368.75 points at 79,647.15, while the NSE Nifty50 fell 115.25 points to 24,650.65 as of 9:34 am.
The ongoing conflict has raised fears that. If oil supply tightens, crude prices may rise further. Higher oil prices can increase inflation and slow down economic growth across the world. These worries have made investors cautious, leading to swings in the stock market.
For many investors, the recent fall has also pushed their portfolios into the red. This has left many wondering when the market may stabilise and turn positive again.
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said that crude prices will remain the key factor influencing markets in the near term.
“As the war continues to rage and uncertainty looms large, markets will be influenced by the crude prices. It is important to understand that even though crude has spiked by about 16% since the war began this is not among the major spikes in crude compared to earlier geopolitical crises which impacted crude. This is a reflection of the potential huge supply of oil available in the global market.”
He added that the market could recover once tensions ease in West Asia.
“Once the West Asian crisis deescalates, crude prices will dip sharply and markets will bounce back. Therefore, crude price will continue to influence the market in the near-term.”
Dr. Vijayakumar also said investors should closely track Brent crude levels.
“So long as Brent crude moves around $85 levels, the market is unlikely to be impacted. On the other hand, if Brent price spikes above $90 and moves towards $100, globally markets will be impacted. Therefore, watch out for crude prices.”
In early trade, Bharat Electronics Ltd was the top gainer among Sensex stocks, rising 2.34%. NTPC Ltd followed with a gain of 1.81%, while Reliance Industries Ltd was up 1.77%. Tech Mahindra Ltd advanced 1.13% and HCL Technologies Ltd climbed 1.11%.
On the losing side, InterGlobe Aviation Ltd was the worst performer, falling 2.23%. ICICI Bank Ltd declined 2.01%, Larsen and Toubro Ltd dropped 1.70%, HDFC Bank Ltd slipped 1.30%, and Bajaj Finserv Ltd was down 1.21% in early deals.
In the broader market, the trend was slightly mixed. The Nifty Midcap 100 index rose 0.45% and the Nifty Smallcap 100 gained 0.59%. At the same time, India VIX, which measures market volatility, was up 2.36%.
Among sectoral indices, several sectors were trading lower. Nifty Auto fell 0.49%, Nifty Financial Services 25/50 declined 0.74%, Nifty FMCG slipped 0.10%, and Nifty Media was down 0.11%. Nifty PSU Bank dropped 0.21%, while Nifty Private Bank fell 0.95%. Nifty Realty declined 0.44% and the Nifty Healthcare Index was down 0.15%.
Some sectors, however, managed to trade in the green. Nifty IT rose 1.31%, while Nifty Metal and Nifty Pharma both edged up 0.01%. Nifty Consumer Durables gained 0.07% and Nifty Oil & Gas was up 0.09%.
Market experts also advise investors to remain cautious while volatility continues.
Aakash Shah, Technical Research Analyst at Choice Equity Broking Private Limited, said investors should focus on strong companies and avoid rushing into fresh positions.
“Considering the ongoing global uncertainties and elevated market volatility, investors are advised to remain disciplined and selective, focusing on fundamentally strong stocks during market corrections. Fresh long positions should ideally be considered only after a clear and sustained breakout above the 25,000 level on the Nifty, as such a move would signal improving sentiment and confirm the development of a stronger bullish structure.”
The current market trend shows that investors are closely watching global developments, especially the movement in crude oil prices and the progress of the conflict. Any easing of tensions could help calm markets, while a sharp rise in oil prices could keep volatility high in the near term.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)