Sensex and Nifty tumbled in early trade as investors reacted to escalating West Asia tensions, rising oil prices and PM Modi’s remarks on fuel conservation, foreign travel and gold purchases. The Indian stock market on Monday began the week on a weak note with a big drop as heightened geopolitical tensions in West Asia, spiking crude oil prices, and across-the-board selling weakened investors’ confidence. The benchmarks, Sensex and Nifty, traded lower during morning hours as global uncertainties rose and banks, autos, realty and consumption stocks plunged.
The NSE Nifty 50 index, closing down 299.25 points or 1.24% at 23,876.90, moved below the critical level of 23,900. The index, which opened at 23,970.10, has hit an intra-day low of 23,864.10 in morning trade.
The BSE Sensex was also down under tremendous sell-off pressure, trading at 76,258.40 with a drop of 1,069.79 points or 1.38% at 10:15 am.
Market sentiment remained shaky with fresh uncertainty over the ongoing Iran-US conflict. Prime Minister Narendra Modi’s comments on fuel conservation, cutting down on unnecessary foreign travel and postponing non-essential gold purchases also kept several sectors and stocks in focus.
Midcaps, Smallcaps, Microcaps see a broad-based sell-off
It wasn’t only the leading indices that were under selling pressure; heavier selling was seen in broader markets too.
The Nifty Next 50 index dropped 1.47% to 70,446.00. The Nifty Smallcap 100 was down 1.30%. The Nifty MidSmallcap 400 index fell 1.11%, and the Nifty Microcap index was among the top losers, declining 1.52%.
Meanwhile, the Nifty 100 and 200 indices fell 1.34% and 1.26%, respectively, suggesting broad-based weakness across sectors and market-capitalisation segments.
The banking counters were the biggest drag on the market, with the BSE Bankex plunging 1.54% due to continued selling in financial stocks. However, IT stocks held up relatively better than the broader market sell-off, with the BSE Focused IT index losing a relatively lower 0.37%.
Why Are Sensex And Nifty Falling Today? Here Are 3 Key Reasons
1. Global markets spooked over Iran-US geopolitical tensions
Investor sentiment sours on the prospect of renewed tensions between the US and Iran over stalled peace talks.
Iran has apparently rejected the US peace offer and demanded instead war reparations, recognition of its control of the Strait of Hormuz, an end to US sanctions and the release of frozen assets. Iran’s offer was “absolutely unacceptable,” said United States President Donald Trump, dimming further hopes of an imminent resolution.
Also Read: Trump Criticises Iran’s Reaction to Peace Plan, Calls It “Totally Unacceptable”
The war, which began on Feb. 28, has badly disrupted activity around the Strait of Hormuz, a key route for global oil supplies, and fears are rising of prolonged instability in energy markets.
Geopolitical uncertainty created a global risk-off mood and saw investors switch equities for safe assets.
2. Consumption stocks under pressure as Modi’s Fuel Conservation Drive gains momentum
Investor attention was also on the comments of Prime Minister Narendra Modi on Sunday, who asked people to save fuel, cut down on petrol and diesel dependence, avoid unnecessary foreign travel and postpone gold purchases amid the escalating West Asia crisis.
The Prime Minister called for work-from-home practices during the pandemic period and increased use of public transport and carpooling, while asking EV owners to maximise EV usage.
Comments triggered caution in a number of consumption-linked sectors such as hospitality, aviation, oil marketing and jewellery stocks as investors weighed the possible impact on consumer demand and discretionary spending.
Also Read: Kalyan Jewellers Shares Sink Over 9% After PM Modi’s ‘Don’t Buy Gold’ Appeal
3. Crude oil prices shoot sharply up
Yet another cause that drove the markets down on Monday was a strong upswing in crude oil prices.
The Brent crude shot up 3.5% to $104.80 per barrel, and WTI prices stood around the $99 mark on the news that the U.S. Rejected the latest proposals from Iran that were aimed at diffusing the crisis.
The hike in crude prices could seriously put economic strains on countries like India, which are primarily dependent on crude oil imports. The rise in energy costs could expand the trade gap, fuel inflation and dent corporate profit.
Aviation, jewellery, paint, logistics, and oil marketing stocks took a hard hit on account of rising crude prices during the session as well.
Rupee Slips Against the US Dollar
On Monday, the Indian rupee also commenced significantly weak against the US dollar owing to increasing global turmoil and the firming up in crude oil prices.
The local unit opened at 94.88 against the dollar, losing 40 paise from its Friday closing of 94.48.
The weakening rupee is likely to increase the import costs, specifically for crude oil for India, thereby leading to inflation fears that consequently impact the market sentiment.
Indian equity markets may continue to see continued volatility in the coming few days, analysts suggest, due to the growing geopolitical concerns and escalating crude oil prices.
(Disclaimer: This article is for informational purposes only and should not be considered investment advice. The views, opinions, and recommendations expressed herein are those of the respective experts. Readers are advised to consult a qualified financial advisor before making any investment decisions.)
Priyanka Roshan is a business writer and chief sub-editor at the NewsX website who tracks everything from stock market swings and corporate earnings to personal finance trends and policy shifts. Known for turning fast-moving business developments into sharp, reader-friendly stories, she combines speed, accuracy, and a data-driven approach to break down complex financial news for everyday audiences.
With over 9.5 years of newsroom experience, Priyanka has worked with leading media organisations, including Moneycontrol, Times Now, and Ping Digital, covering diverse beats such as business, politics, technology, auto, travel, sports, and the world. From live breaking news desks to SEO-led digital storytelling, she specialises in creating engaging content that keeps readers informed without overwhelming them.
