Stock markets nosedive as US-Iran war spreads

Mumbai: Indian equity markets fell sharply for the third consecutive session on Wednesday as escalating tensions in West Asia dented investor sentiment, pushed crude oil prices higher and triggered a broad global risk-off trade.

The 30-share Sensex slumped 1,122.66 points, or 1.40 per cent, to close at 79,116.19, its lowest level in 10 months. During the session, it plunged as much as 1,795.65 points, or 2.23 per cent, to hit an intraday low of 78,443.20 before paring some losses in the latter half.

The broader NSE Nifty declined 385.20 points, or 1.55 per cent, to settle at 24,480.50, marking its third straight session of losses and its lowest closing level in over six months. At the day’s low, the index slipped 560.30 points, or 2.25 per cent, to 24,305.40.

Market sentiment remained under severe pressure as the conflict in West Asia intensified, with Iran continuing attacks on several Gulf countries in retaliation for joint strikes by Israel and the United States. Fresh strikes by the US and Israel further heightened global uncertainty.

Brent crude oil surged 3.08 per cent to USD 83.91 per barrel, aggravating inflation and current account deficit concerns.

Asian markets closed sharply lower, led by South Korea’s Kospi, which plunged 12 per cent. Japan’s Nikkei 225, Shanghai Composite and Hong Kong’s Hang Seng also ended significantly lower. European markets were trading higher, while US markets closed in the red on Tuesday.

Broader markets underperformed benchmarks, with the Nifty MidCap index falling 2.2 per cent and the Nifty SmallCap index declining 2.1 per cent. Metal stocks were the worst hit, followed by PSU banks and realty, while IT was the only sector to close in the green.

On the Sensex, Tata Steel, Larsen & Toubro, Bajaj Finance, UltraTech Cement, NTPC and InterGlobe Aviation were among the major laggards. Bharti Airtel, Infosys and Tech Mahindra gained.

Foreign Institutional Investors sold equities worth Rs 3,295.64 crore, while Domestic Institutional Investors bought shares worth Rs 8,593.87 crore. Analysts warned volatility may persist amid geopolitical uncertainty.