Indian shares opened lower on Monday, tracking a sharp sell-off across Asian markets as a spike in oil prices, renewed West Asia tensions and rising fears of a US interest rate hike weighed on risk appetite.
The benchmark fell 1.22% to 23,080.70, while the lost 1.11% to 73,421.61 by 9:15 a.m. IST.
All 16 major sectors logged losses. High-weightage financials and IT stocks lost 1.3% and 1.5%, respectively.
The broader small-caps and mid-caps declined 1.2% and 1.3%, respectively.
Brent crude futures rose 3.5% to $96.5 a barrel after Iran launched missiles at Israel following Israeli strikes on Beirut, reducing hopes for an end to the wider war and raising fears of disruption to oil supplies.
The broader MSCI Asia ex-Japan index tumbled 2.7%, while South Korea’s KOSPI fell 4.8% and Japan’s Nikkei lost 3.8%, led by declines in AI-linked stocks after their recent rally.
A stronger-than-expected May jobs report lifted expectations for a US Federal Reserve rate hike by end-2026, also weighing on sentiment.
The probability of a Fed rate increase by December 2026 rose to 72.3% from 45.2% a week earlier, according to CME FedWatch.
Higher US rates typically reduce the appeal of emerging markets such as India.