Closing Bell: Sensex, Nifty extend losses to over 4% in 4 sessions amid sell-off on D-Street

Stock Market Closing Bell: Indian equity benchmarks ended sharply lower on Tuesday, extending losses for the second consecutive session, as rising geopolitical tensions in West Asia, surging crude oil prices, weakness in the rupee and heavy foreign investor selling weighed heavily on market sentiment.

The decline accelerated after Prime Minister Narendra Modi urged citizens to reduce energy consumption, foreign travel and gold purchases, triggering concerns over the possible economic impact of the ongoing conflict in West Asia.

The Nifty 50 settled 399.55 points, or 1.68 per cent, lower at 23,416.90, while the BSE Sensex dropped 1,349.95 points, or 1.78 per cent, to close at 74,668.30.

Broader markets witness heavy selling

Selling pressure remained widespread across the broader market.

The Nifty MidCap index ended 2.54 per cent lower, while the Nifty SmallCap index declined 3.17 per cent as investors continued to cut exposure to riskier assets.

Weak market breadth reflected the intensity of the selloff across sectors.

IT, realty stocks among biggest losers

Sectorally, information technology and realty stocks emerged as the worst performers of the session.

Consumer durable and media stocks also remained under pressure, while metal and oil & gas shares relatively outperformed amid rising crude oil prices.

Trump remarks deepen geopolitical concerns

Investor sentiment turned more cautious after US President Donald Trump said the month-old ceasefire with Iran was on “massive life support” after Tehran reportedly submitted an “unacceptable” proposal.

Reports suggesting the ceasefire remained fragile further dented risk appetite globally and raised concerns about prolonged tensions in the region.

Brent crude climbs above $107

Crude oil prices surged following Trump’s remarks.

Brent crude’s May futures contract rose 2.90 per cent to $107.23 per barrel on the Intercontinental Exchange amid expectations that supply disruptions around the Strait of Hormuz could continue longer than anticipated.

The sharp rise in oil prices remains a major concern for India as it could fuel inflation, weaken the rupee and widen the trade deficit.

Factors that weighed on market sentiment

Ahead of Tuesday’s trading session, Zee Business Managing Editor Anil Singhvi had highlighted several factors that could keep markets under pressure, many of which eventually played out during the day’s trade.

According to Singhvi, Prime Minister Modi’s appeal for restraint had created an atmosphere of fear and caution in the market. Singhvi also noted that both the Nifty50 and Nifty Bank had broken important technical support levels, while weekly expiry-related volatility and sharp declines in midcap and smallcap stocks could worsen market sentiment.

He also pointed out that growing macroeconomic concerns had led to a slowdown in stock-specific and sector-specific buying activity.

Volatility likely to remain elevated

Analysts expect market volatility to stay high in the near term as investors continue to monitor developments in West Asia, crude oil prices, currency movement and foreign fund flows.

Concerns over inflation and slowing global growth are also expected to keep pressure on domestic equities in the coming sessions.