The markets extended their losing streak for the second consecutive session on Friday, with the Sensex plunging 573.38 points or 0.70 per cent to close at 81,118.60, and the Nifty 50 dropped 169.60 points or 0.68 per cent to 24,718.60. The sell-off was triggered by escalating geopolitical tensions after Israel’s military strikes against Iran, which sent crude oil prices soaring and prompted investors to flee to safe-haven assets.
Brent crude prices climbed near $76 per barrel, their highest this year, while WTI crude surged above $74, marking a 9 per cent jump that raised fresh inflation concerns. The geopolitical escalation overshadowed positive domestic data showing India’s Consumer Price Index for May easing below the Reserve Bank of India’s comfort threshold.
“The initial reaction was largely driven by a sharp rise in crude oil prices due to geopolitical tensions in West Asia. However, a moderation in CPI inflation helped limit the downside,” said Ajit Mishra, Senior Vice-President Research at Religare Broking Ltd.
Banking and FMCG stocks emerged as the primary drags on the market, with the Nifty Bank index declining 1.17 per cent and the Nifty PSU Bank index underperforming with a 1.18 per cent drop. The Nifty Metal index also fell 0.96 per cent, reflecting broad-based selling pressure across sectors.
Among individual stocks, (BEL) emerged as the top gainer, rising 2.00 per cent to ₹395.15, followed by (ONGC) which gained 1.28 per cent to ₹251.05. climbed 0.83 per cent to ₹1,658.00, while and posted modest gains of 0.38 per cent each, closing at ₹260.59 and ₹3,447.40 respectively.
On the losing side, led the decline, falling 2.27 per cent to ₹1,406.10. dropped 1.67 per cent to ₹413.95, while declined 1.57 per cent to ₹793.30. fell 1.49 per cent to ₹641.35, and slipped 1.43 per cent to ₹2,506.00.
The broader market also remained under pressure, with the Nifty Midcap 100 index losing 0.37 per cent to 58,227.45 and the Nifty Smallcap 100 declining 0.5 per cent. Market breadth was negative, with 2,469 stocks declining against 1,516 advances on the BSE, while 80 stocks hit 52-week highs and 57 touched 52-week lows.
The bore the brunt of the risk-off sentiment, trading weak below 86.05, down by 0.52 against the dollar despite a softer dollar index. “The escalation in Middle East tensions pushed WTI crude prices above the $74, marking a 9 per cent surge, which added significant pressure on the rupee,” said Jateen Trivedi, VP Research Analyst at LKP Securities.
prices surged past the ₹1 lakh mark per 10 grams domestically, and soared above $3,440 per ounce internationally as investors flocked to safe-haven assets. “Gold prices touched a new high and scaled past the ₹1 lakh-mark per 10 gram, while in the international markets the bullion soared past $3,440 per ounce, as investors flocked to safe-haven assets amid mounting global instability,” said Rahul Kalantri, VP Commodities at Mehta Equities Ltd.
The India VIX spiked over 7 per cent, reflecting heightened volatility and investor anxiety. Defence stocks bucked the trend, witnessing sharp buying interest amid escalating hostilities as investors anticipated increased order flows and spending in the defense sector.
“Indian equity benchmarks experienced downward pressure, driven by weak global cues and foreign institutional outflows. Market sentiment was notably impacted by heightened geopolitical tensions following Israel’s military strike on Iran, which significantly increased risk aversion among investors,” said Vinod Nair, Head of Research at Geojit Investments Ltd.
Looking ahead, technical analysts suggest the could continue consolidating within the 24,400-25,200 range. “The recovery could gain traction if the Nifty sustains above the 24,700 level. On the upside, the index may move towards 25,000 in the short term. Conversely, a decisive fall below 24,700 could trigger renewed bearish bets in the market,” said Rupak De, Senior Technical Analyst at LKP Securities. Market participants are likely to remain cautious until geopolitical stability returns to West Asia.