Indian equity markets opened sharply lower on Monday, tracking weakness across global markets amid escalating geopolitical tensions between the United States and Iran, which pushed crude oil prices higher and dampened investor sentiment.
The BSE Sensex fell 670.12 points, or 0.86 per cent, to 76,899.27, while the NSE Nifty50 declined 192.15 points, or 0.79 per cent, to 24,014.75 in early trade.
Market experts attributed the decline to renewed uncertainty in the Middle East following the collapse of the United States-Iran ceasefire, raising concerns over global energy supplies and triggering volatility across financial markets.
Ajay Bagga, banking and market expert, said Indian markets had recovered last week but ended a four-week gaining streak with marginal weekly losses.
“Indian markets recovered last week but ended a four-week positive move with a small negative weekly performance. This morning the Gift Nifty is pointing to a weak start,” Bagga said.
Despite the weak opening, Bagga remained optimistic about the domestic market outlook.
“We remain positive on Indian markets on the back of improving earnings, two years of underperformance and strong domestic flows. It remains a buy-on-dips market despite the clouded picture from the Persian Gulf,” he said.
The domestic weakness mirrored losses across Asian markets, with Japan’s Nikkei 225 and South Korea’s KOSPI also trading lower amid growing geopolitical concerns.
Crude oil prices surged after tensions escalated in the Middle East, with Brent crude rising 4.01 per cent to USD 79.06 per barrel, while WTI crude gained 4.00 per cent to USD 74.27 per barrel. Gold, however, declined 1.49 per cent to USD 4,059.73.
Commenting on the geopolitical situation, Bagga said the renewed conflict was disrupting energy markets.
“The US-Iran war escalation is more like a game of ‘who blinks first,’ but it is roiling oil and gas supplies once more and transmitting risk-off sentiment to all markets,” he said.
He also noted that expectations of tighter monetary policy in the United States and a lower global growth forecast had added to market uncertainty.
Vinit Bolinjkar, Head of Research at Ventura, said foreign institutional investors (FIIs) had turned net buyers during the first week of July, investing more than ₹3,421 crore in the cash market after reversing their cautious stance seen in late June.
“This shift reflects improving sentiment amid stabilising global cues, expectations of a constructive Q1 earnings season, and selective buying in financials and autos. However, markets remain sensitive to developments in India-US trade negotiations and geopolitical risks,” Bolinjkar said.
He said Nifty is expected to find support in the 23,700-23,800 range, while resistance is likely around 24,200-24,300. He advised investors to adopt a stock-specific approach, focusing on fundamentally strong large-cap companies and sectors expected to benefit from earnings upgrades and domestic growth.
Among major stocks, IndiGo, Tata Steel and Maruti Suzuki were among the top losers in early trade, while Tata Consultancy Services (TCS), ONGC and NTPC traded in positive territory.
(ANI Inputs)
