Indian stock markets witnessed a sharp sell-off at the open on Friday as escalating tensions between Israel and Iran triggered a broad-based risk-off sentiment across global financial markets.
Key sectors like auto, IT, financial services, and PSU banks led the decline.
By 9:33 AM, the Sensex had dropped 896.5 points (1.10%) to 80,795.44, while the Nifty fell 278.5 points (1.12%) to 24,609.70.
Other indices also reflected the pressure:
- Nifty Bank dropped 633.80 points (1.13%) to 55,448.75
- Nifty Midcap 100 lost 603.90 points (1.03%) to trade at 57,836.95
- Nifty Smallcap 100 fell 192.75 points (1.04%) to 18,272.30
Expert views on market sentiment
Analysts say the market is reacting to the uncertainty around Israel’s ongoing military operations, which could escalate further if retaliatory actions by Iran continue.
“The impact on the market will depend on how long the conflict lingers. In the near term, the market will be in a risk-off mode. Sectors that use oil derivatives as inputs, like aviation, paints, adhesives and tyres, will be hit hard. Oil producers like ONGC and Oil India will remain resilient,” Dr VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, stated.
Akshay Chinchalkar, Head of Research at Axis Securities, pointed to technical warning signs on the charts.
“Technically, on the Nifty, we have been warning that Wednesday’s ‘buyer rejection’ candle immediately occurring after the bearish ‘upside gap two crows pattern’ earlier in the week was an indication of caution creeping in,” he asserted.
In early trade, Tata Motors, L&T, PowerGrid, Kotak Mahindra Bank, SBI, Titan, and Infosys were among the biggest losers on the Sensex.
Asian markets mirrored the downtrend, with benchmarks in Hong Kong, Bangkok, Jakarta, Japan, Seoul, and China all in negative territory.
In contrast, US markets ended higher in the previous session:
- Dow Jones rose 101.85 points (0.24%) to 42,967.62
- S&P 500 gained 23.02 points (0.38%) to 6,045.26
- Nasdaq added 46.61 points (0.24%) to 19,662.49
On the institutional front, Foreign Institutional Investors (FIIs) continued selling, offloading equities worth Rs 3,831.42 crore on 12 June, while Domestic Institutional Investors (DIIs) purchased shares worth Rs 9,393.85 crore.
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