MUMBAI: Benchmark equity indices Sensex and Nifty slumped more than 1 per cent on Friday as rising tensions between India and Pakistan unnerved investors, sparking fears of a prolonged conflict.
Steep losses in realty, financial and utility stocks also weighed on market sentiment, traders said.
The 30-share BSE Sensex shed 880.34 points or 1.10 per cent to end the session at 79,454.47, extending Thursday’s losses in largely range-bound trade. On the broader market, 2,522 stocks declined, 1,343 advanced and 145 remained unchanged on the BSE.
The NSE Nifty dropped 265.80 points or 1.10 per cent to close at 24,008.
Tensions flared after India on Thursday night thwarted Pakistan’s attempts to strike military targets in Jammu and Pathankot using drones and missiles. This came a day after the Indian armed forces carried out precise missile strikes on nine terror targets in Pakistan-occupied Kashmir and Pakistan under ‘Operation Sindoor’.
“A conflict was anticipated, but the market did not expect such escalation, leading to concerns about how long it could last. Still, it is likely to remain a short-lived confrontation, considering India’s strategic edge and Pakistan’s weak economic condition,” said Vinod Nair, Head of Research at Geojit Financial Services.
From the Sensex pack, ICICI Bank, Power Grid, UltraTech Cement, Bajaj Finance, HDFC Bank, Reliance Industries, Bajaj Finserv, Adani Ports, Mahindra & Mahindra and NTPC were among the top laggards.
In contrast, Tata Motors, State Bank of India (SBI) and Asian Paints ended in the green.
Titan, L&T soar 4%
Titan Company gained over 4 per cent after the Tata Group firm posted a 13 per cent rise in consolidated net profit to Rs871 crore for the March quarter, driven by robust sales. Larsen & Toubro jumped nearly 4 per cent after it reported a 25 per cent increase in consolidated net profit to Rs5,497 crore, aided by higher revenues and an exceptional gain.
On the week, the BSE Sensex dropped 1,047.52 points or 1.30 per cent, and the Nifty shed 338.70 points or 1.39 per cent.
“Markets extended their losing streak for the second straight session as heightened geopolitical tensions overshadowed otherwise positive global cues. The broader risk-off mood was evident in the over 1 per cent weekly losses for both Sensex and Nifty,” said Bajaj Broking Research.
The BSE smallcap index declined 0.30 per cent, while the midcap gauge slipped 0.10 per cent.
Among sectoral indices, realty fell 2.08 per cent, utilities 1.50 per cent, financial services 1.40 per cent, power 1.11 per cent, Bankex 1.04 per cent, FMCG 0.65 per cent and services 0.63 per cent. On the other hand, capital goods rose 1.67 per cent, consumer durables gained 1.29 per cent, industrials 1.10 per cent and metals 0.17 per cent.
Markets under pressure
“Markets came under pressure amid the escalating geopolitical tensions between India and Pakistan,” said Ajit Mishra, SVP – Research at Religare Broking Ltd.
Foreign Institutional Investors (FIIs) bought equities worth Rs2,007.96 crore on Thursday, as per exchange data.
In Asian markets, South Korea’s Kospi and China’s Shanghai Composite closed lower, while Japan’s Nikkei 225 and Hong Kong’s Hang Seng posted gains. European markets were trading higher, and US markets ended in positive territory on Thursday.
Brent crude, the global oil benchmark, rose 1.53 per cent to $63.80 a barrel.
“Defence-related stocks like Bharat Electronics and Hindustan Aeronautics outperformed on expectations of increased defence spending. With India VIX surging, investors should remain stock-specific and avoid aggressive bets until the situation stabilises,” Mishra added.
On Thursday, the BSE Sensex had declined 411.97 points or 0.51 per cent to close at 80,334.81, while the Nifty dropped 140.60 points or 0.58 per cent to end at 24,273.80.
