Indian markets came under heavy selling pressure on Wednesday as escalating tensions in West Asia and a sharp rise in global crude oil prices overshadowed strong domestic economic data. The Stock market today remained firmly in the red, with the BSE Sensex falling 713.42 points, or 0.93 per cent, to 76,230.86, while the NSE Nifty 50 dropped 197.80 points, or 0.82 per cent, to 23,858.00. The decline came despite strong Q1 GDP numbers and improving domestic indicators, showing how strongly global risks are influencing the Indian stock market.
Stock market today: Iran war, crude surge put pressure on equities
Ajay Bagga, Banking and Market expert, said the market outlook remained weak as global developments overshadowed India’s strong macro picture. “Indian markets are pointing to a weak open as per the futures. Despite the strong macro and GDP print, the Iran war disruption is keeping Indian markets challenged. Global factors are dominating the strong domestic picture unfortunately,” he said.
Bagga added that renewed escalation in the Iran war has pushed crude prices sharply higher and raised concerns that inflation could stay elevated for longer. “Risk off globally, with renewed escalation in the Iran war leading to a sharp spike in crude oil prices, pointing to inflation staying higher for longer. Bond yields are flashing danger signals. ECB, BOJ are slated to raise rates this month. Inflation across most of the world is above central bank targets which is a pointer to higher rates in the future,” he said.
Stock market today: Sensex Nifty follow weak global cues
The global market setup also remained negative. Nasdaq ended 1.03 per cent lower, down 271.11 points at 26,099.77, while the S&P 500 slipped 0.71 per cent, or 54.67 points, to 7,631.47. Dow Jones Futures were down 6.22 points, or 0.01 per cent, at 52,760.66.
Asian markets followed the weakness. Japan’s Nikkei 225 declined 2.81 per cent, South Korea’s KOSPI fell 3.44 per cent and Hong Kong’s Hang Seng dropped 1.17 per cent. GIFT Nifty was also down 122.50 points at 23,928.50. “Taking a cue from weak US markets, Asian markets are a splash of red this morning as Brent moved to USD 96 levels and New Zealand became the latest central bank to raise rates to tame entrenching inflation,” Bagga said.
Stock market today: Strong India data offers some support
V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said the Stock market today is caught between strong domestic factors and powerful external risks. “The market is delicately poised between domestic tailwinds and external headwinds. The domestic tailwinds from impressive Q1 GDP numbers, excellent high frequency data from GST collections, credit growth and automobile numbers and improving prospects for earnings growth are big positives for the market,” he said.
However, he pointed to the US-Iran conflict and crude prices as major negatives. “Unfortunately, the headwinds also are equally strong. The escalation of the US-Iran conflict and the consequent 5% spurt in Brent crude overnight to USD 96 is a sentiment negative. However, this is not a big threat since our CAD is running at only 0.5% and forex reserves are ample at USD 730 billion,” Vijayakumar stated.
Stock market today: Crude, gold and US yields remain key triggers
Commodity markets reflected the broader uncertainty. Brent crude gained 0.72 per cent, or USD 0.68, to USD 95.33 a barrel, while WTI crude rose 0.52 per cent, or USD 0.47, to USD 90.69. Gold, meanwhile, declined 0.86 per cent, or USD 37.37, to USD 4,291.35.
For investors tracking Nifty today, Sensex today, and Sensex Nifty moves, Vijayakumar said the biggest risk could come from rising US bond yields. “The macro construct in the US indicates further hardening of the bond yields. If the 10-year yield touches 5% that has the potential to trigger a big correction in equity markets globally. Therefore, this is the macro indicator to watch closely. The near-term market trend will depend on which of these forces -the tailwinds or headwinds- will emerge stronger.”
The warning remains central to stock market news today, as global crude prices, bond yields and the Iran conflict continue to compete with India’s strong economic fundamentals. For the Indian stock market, the balance between these domestic positives and external pressures will determine the next market move.
(with inputs from ANI)
Khalid Lateef is a Sub-Editor at NewsX Digital, specializing in Indian politics and global affairs. He also covers viral trending stories and major crime developments.
