Sensex, Nifty fall in early trade amid geopolitical tensions and rising oil prices

Indian benchmark equity indices declined sharply in early trading on Friday, pressured by rising crude oil prices and heightened geopolitical tensions linked to the conflict between the United States and Iran.

By around 9:25 a.m., the BSE Sensex had dropped about 516 points, or 0.68 per cent, to 75,517, while the Nifty 50 fell 174 points, or 0.74 per cent, to 23,464.

Broader market indices also traded lower, with the Nifty Midcap 100 down 0.84 per cent and the Nifty Smallcap 100 declining 1.08 per cent.

Most sectoral indices were in negative territory, with the exception of the Nifty FMCG, which gained 0.41 per cent. The Nifty Metal index led the losses, falling 1.84 per cent, while the Nifty IT and Nifty Media indices were also among the major laggards.

Market analysts said the near-term resistance level for the Nifty is around 23,800, while support is seen near the 23,600 mark. For the Bank Nifty, resistance is estimated in the 55,600–55,700 range, with support near 54,700.

Investor sentiment has been affected by developments in West Asia, where Mojtaba Khamenei, the new supreme leader of Iran, has called for the closure of the Strait of Hormuz and warned that Tehran could open additional fronts if the conflict continues.

Despite the volatility in energy markets, analysts said there is no immediate threat to fuel supplies in India. The main concern for markets remains the impact of higher oil prices on inflation, the rupee and corporate costs.

India currently maintains a substantial energy buffer, including about 25 days of crude oil reserves and a similar amount of refined fuel stocks, along with strategic petroleum reserves. Together, these provide a supply cushion of roughly 50 to 60 days even without fresh imports.

Elsewhere in Asia, markets also declined. The Shanghai Composite slipped 0.22 per cent and the Shenzhen Component Index eased 0.17 per cent. Japan’s Nikkei 225 fell 1.22 per cent, while Hong Kong’s Hang Seng Index dropped 0.43 per cent and South Korea’s Kospi declined 1.58 per cent.

US markets had closed sharply lower overnight. The Nasdaq Composite fell 1.78 per cent, the S&P 500 lost 1.52 per cent and the Dow Jones Industrial Average dropped 1.56 per cent.

On Thursday, foreign institutional investors were net sellers of Indian equities worth Rs 7,049 crore, while domestic institutional investors purchased shares worth Rs 7,449 crore, helping to partially offset the outflows.

With IANS inputs