Indian equity benchmarks faced significant losses on Friday as the BSE Sensex and Nifty indices reacted to escalating geopolitical tensions and a sharp rise in oil prices. The 30-share Sensex pack dropped 1,337 points or 1.63 per cent to 80,354.59, while the broader Nifty index fell 415.20 points or 1.67 per cent to 24,473.
The market downturn followed Israel’s military action against Iran’s nuclear facilities, which caused a surge in Brent crude oil prices. Brent crude futures for August delivery shot up by over 13 per cent, reaching a peak of $78.50 per barrel. Last checked, the price was still up 8.79 per cent at $75.36 a barrel.
The volatility was mirrored in Asian markets, where indices in Japan, mainland China, Hong Kong, Korea, and Taiwan each fell by up to 1.3 per cent. Oil marketing companies in India, including BPCL, HPCL, and IOC, saw their stocks slide by as much as 4 per cent as investors reacted to the climbing oil prices.
According to a report by news agency Reuters, Israel announced that it had targeted Iran’s nuclear sites, ballistic missile manufacturing facilities and key military figures. This military action was declared as part of a sustained operation to prevent Iran from developing a nuclear weapon.
The market sentiment was further dampened by domestic factors, despite the Reserve Bank of India’s (RBI’s) significant rate cut. “On this ominous Friday the 13th, markets are gripped by caution as bearish signals intensify—despite the RBI’s jumbo rate cut, banking stocks remain weak, and FIIs have sold Rs 3,549 crore so far this June, contributing to continued volatility,” said Prashanth Tapse, Senior VP (Research), Mehta Equities.
Geopolitical concerns were compounded by international tensions, with former US President Donald Trump threatening 55 per cent tariffs on China, which in turn downplayed their trade deal with the US. Meanwhile, WTI crude oil remained steady at $75 per barrel amid ongoing US-Iran tensions.
Crude oil futures surged past $78 per barrel — the highest level in two months — amid escalating tensions between Israel and Iran, raising concerns over potential supply disruptions, said Rahul Kalantri, VP Commodities at Mehta Equities.
“We expect crude oil prices to remain volatile in today’s session. On the international front, crude has support at $70.40–68.50 and resistance at $74.00–75.20. In Indian markets, support is seen at Rs 5,690–5,630, while resistance is placed at Rs 6,200–6,450,” he added.
As the trading day progressed, markets remained on edge, reflecting broader global uncertainties and the direct impact of geopolitical developments on financial markets. The cautious investor behaviour highlighted the potential for further volatility.
To substantiate further, India VIX — a fear index which measures market volatility — today surged 7.95 per cent to 15.13, NSE data showed.
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