MUMBAI: Stock markets fell sharply on Friday, shedding nearly 1 per cent each, as rising geopolitical tensions in the Middle East and a surge in Brent crude prices soured investor sentiment.
Extending losses for the second consecutive session, the 30-share BSE Sensex plunged 573.38 points or 0.70 per cent to close at 81,118.60. Earlier in the day, the index had slumped 1,337.39 points or 1.63 per cent to hit an intraday low of 80,354.59.
On the NSE, the 50-share Nifty dropped 169.60 points or 0.68 per cent to settle at 24,718.60.
The broader stock markets also remained weak, with 2,469 stocks declining and 1,516 advancing on the BSE while another 137 stocks were unchanged.
During the week, the Sensex lost 1,070.39 points or 1.30 per cent, while the Nifty declined 284.45 points or 1.13 per cent.
Investors shunned riskier assets amid mounting fears of a wider conflict after Israel reportedly carried out air strikes on Iranian targets. Concerns over foreign fund outflows and stretched equity valuations also weighed on the market.
“Rising tensions in the Middle East after Israel attacked key Iranian areas drove investors to safe-haven assets like gold as riskier equities continued to face battering. Along with fresh concerns of the US likely to impose unilateral tariffs over the next few weeks and higher valuations of domestic equities resulted in consolidation of markets,” said Prashanth Tapse, Senior Vice President (Research), Mehta Equities Ltd.
Major laggards
Among Sensex constituents, major laggards included Adani Ports, ITC, State Bank of India, IndusInd Bank, HDFC Bank, Titan, Kotak Mahindra Bank and UltraTech Cement. On the other hand, Tech Mahindra, Tata Consultancy Services, Sun Pharma and Maruti managed to post gains.
The BSE midcap index fell 0.32 per cent, while the smallcap index declined 0.30 per cent.
Among sectoral indices, the BSE services index tumbled 2.06 per cent, while bankex, FMCG, financial services, metal and power fell between 0.75 per cent and 1.01 per cent. Healthcare and realty were the only gainers for the day.
“Although India’s CPI for May eased below the RBI’s comfort threshold, offering a positive macro signal, this was largely overshadowed by external headwinds. Brent crude prices climbed to near $76 per barrel, their highest this year, raising fears of inflation if tensions persist,” said Vinod Nair, Head of Research, Geojit Financial Services.
Global crude benchmark Brent rose 7.44 per cent to $74.52 per barrel.
Asian markets ended lower, with indices in South Korea, Japan, China and Hong Kong all in the red. Key European markets were also trading lower.
US markets had closed in positive territory on Thursday.
Foreign Institutional Investors (FIIs) sold equities worth Rs3,831.42 crore on Thursday, according to exchange data.
On Thursday, the Sensex had dropped 823.16 points or 1 per cent to end at 81,691.98, while the Nifty tumbled 253.20 points or 1.01 per cent to close at 24,888.20.
