D-Street investors poorer by Rs 33.68 lakh cr since West Asia conflict began

Investor wealth in Indian equity markets has shrunk by about Rs 33.68 lakh crore since the West Asia conflict began nearly two weeks ago, as rising geopolitical tensions and surging oil prices continue to rattle financial markets.

The war, which entered its 14th day on Friday, has unsettled global markets and driven crude prices sharply higher, dragging Indian equities lower in the process.

Since 27 February, the benchmark 30-share BSE Sensex has fallen 6,723.27 points, or 8.27 per cent. During the same period, the total market capitalisation of BSE-listed companies has declined by Rs 33,68,419 crore, slipping to Rs 4,29,82,252.27 crore (about USD 4.65 trillion).

The conflict escalated after the United States and Israel launched military strikes on Iran on 28 February that killed Iran’s Supreme Leader Ayatollah Ali Khamenei. In response, Iran has carried out multiple retaliatory attacks targeting Israeli and American military facilities across several Gulf countries.

Energy markets have reacted sharply. Iran has effectively disrupted shipping through the Strait of Hormuz — the narrow passage between the Persian Gulf and the Gulf of Oman that carries roughly 20 per cent of global oil and liquefied natural gas shipments.

The disruption has pushed Brent crude, the global oil benchmark, to around USD 100 per barrel.

Market participants say the prolonged conflict is keeping investors on edge.

“The ongoing conflict in the Middle East has now entered its second week with no clear signs of de-escalation, as both sides continue to exchange strikes and threats,” said Ponmudi R., chief executive of Enrich Money, an online trading and wealth technology firm.

“This prolonged uncertainty has kept risk aversion elevated across global financial markets,” he added, noting that the conflict and the spike in energy prices remain the dominant forces shaping sentiment across equities, bonds and currency markets.

Indian markets extended their losses on Friday, with the Sensex plunging as much as 1,579.82 points, or about 2 per cent, during intraday trading. The index eventually closed at 74,563.92, down 1,470.50 points or 1.93 per cent.

According to Bajaj Broking, benchmark indices have now fallen for three consecutive sessions amid weak global cues and sustained foreign institutional investor outflows, while crude prices remain elevated because of the West Asia conflict.

Rising oil prices have particularly hurt energy-sensitive sectors. Shares of oil marketing companies ended lower, with HPCL falling about 4 per cent, IOC declining 2.28 per cent and BPCL dropping 2.19 per cent.

Paint manufacturers, which are heavily dependent on petroleum-based raw materials, also came under pressure. Asian Paints, Berger Paints, Kansai Nerolac and Shalimar Paints all finished the session in negative territory.

Aakash Shah, research analyst at Choice Equity Broking, said the market remained under heavy selling pressure throughout the day.

“On March 13, the BSE Sensex ended sharply lower, falling 1,470 points to close at 74,563, marking one of the steepest single-day declines in recent weeks,” Shah said.

He added that investors reacted strongly to escalating geopolitical tensions, the surge in crude oil prices and continued outflows by foreign institutional investors.

With PTI inputs