Stock Market Plummets: Sensex and Nifty Drop Amid Geopolitical Tensions - Read Now
The Indian stock market faced a significant downturn today as geopolitical tensions escalated following Iran's official entry into the Middle East conflict, alongside the recent implementation of SEBI's Futures & Options (F&O) measures. The BSE Sensex plunged nearly 1,300 points in early trading, hovering just above the 83,000-mark, while the Nifty fell over 1.3%, down to 25,452.85 points.
Investor sentiment was already shaky due to rising crude oil prices, which surged amid fears of escalating conflict. The market's decline was further compounded by worries over the potential impact of new F&O regulations, which analysts believe may reduce retail participation. Shares of brokerage firms, including Angel One Ltd and SMC Global Securities Ltd, tumbled, with Angel One shares dropping by 3% and others like Motilal Oswal and IIFL Securities seeing declines of up to 5%.
Market volatility is reflected in the India VIX, which spiked 9.07% to 13.08, suggesting increased uncertainty in the coming weeks. Among the hardest-hit stocks were Mahindra & Mahindra, Asian Paints, Tata Motors, and Maruti Suzuki, all of which experienced losses of up to 2.23%. Major players like ICICI Bank and Reliance Industries also fell by more than 1%.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that while the market had previously downplayed the deteriorating situation in the Middle East, any military action by Israel against Iranian oil installations could drastically impact crude prices, leading to severe repercussions for oil-importing nations like India. He recommended that investors consider shifting their portfolios towards defensive stocks in the pharmaceutical and fast-moving consumer goods (FMCG) sectors.
As foreign institutional investors (FIIs) continue to sell off in the wake of bullish trends in Chinese markets, analysts advise closely monitoring the evolving situation to gauge its potential impact on India’s economic outlook.
