Markets closed sharply lower on Monday as US airstrikes on three Iranian nuclear facilities over the weekend sent shockwaves through global markets, with the Sensex plunging 511.38 points or 0.62 per cent to 81,896.79 and the Nifty 50 declining 140.50 points or 0.56 per cent to 24,971.90.

The dramatic escalation in Middle East tensions began after the United States conducted military strikes on Iranian nuclear-related sites at Fordow, Natanz, and Isfahan, raising fears of broader conflict and supply disruptions.

“The entry of the US into the Israel-Iran conflict heightened tension as panic selling by investors triggered major correction in early trades,” said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.

Markets opened on a weak note with the Sensex starting at 81,704.07 against its previous close of 82,408.17, while the Nifty opened at 24,939.75 compared to the previous close of 25,112.40. However, indices staged a remarkable recovery during the session, with the Nifty touching an intraday high of 25,057 after hitting a low of 24,824.

“The Nifty recovered significantly after a gap-down opening amid weak geopolitical sentiment. A pullback in crude oil prices helped the Indian market pare some of its morning losses, although it still ended on a negative note,” noted Rupak De, Senior Technical Analyst at LKP Securities.

Sectoral performance was mixed, with IT and auto indexes bearing the brunt of selling pressure while the Nifty media index surged 4 per cent. IT stocks came under particular pressure following uncertainty around global tech spending, exacerbated by weak earnings reported by Accenture.

Among individual stocks, Infosys led the losers, falling 2.35 per cent to 1,584.70, followed by HCL Technologies which dropped 2.30 per cent to 1,699.90, Larsen & Toubro declining 2.27 per cent to 3,579.00, Hero MotoCorp falling 2.10 per cent to 4,247.20, and Mahindra & Mahindra sliding 1.52 per cent to 3,136.00.

On the positive side, Trent emerged as the top gainer, surging 3.57 per cent to 6,108.00, followed by Bharat Electronics Limited (BEL) which jumped 3.22 per cent to 421.40, hitting a 52-week high. Hindalco gained 1.98 per cent to 662.00, Tata Consumer Products rose 0.96 per cent to 1,110.80, and Bajaj Finance climbed 0.88 per cent to 913.00.

The broader market showed resilience amid the volatility. “The broader indices managed to inch higher amid choppy trade, gaining between 0.3 per cent and 0.7 per cent,” said Ajit Mishra, SVP Research, Religare Broking Ltd. The Nifty Midcap 100 gained 0.36 per cent while the Nifty Smallcap 100 advanced 0.70 per cent.

Market breadth remained negative with 2,204 stocks declining against 1,854 advances on the BSE, while 182 remained unchanged. A total of 103 stocks hit 52-week highs while 85 touched 52-week lows.

The rupee also came under pressure, weakening 0.11 per cent to 86.75 against the US dollar. “Rupee traded weak by 0.11 at 86.75 as the dollar index appreciated toward the 99 mark, indicating broader currency market imbalances,” said Jateen Trivedi, VP Research Analyst at LKP Securities.

Commodity markets reflected the geopolitical tensions with gold trading positively between $3,350-$3,380 in Comex. “Gold traded in a positive range between $3350–$3380 in Comex as US airstrikes on Iranian nuclear sites heightened geopolitical risks,” Trivedi noted. In the domestic market, gold held firm above ₹98,000 with resistance seen around ₹99,500–₹99,750.

Crude oil prices experienced sharp volatility, with Brent crude briefly surging 5.7 per cent to $81.40 per barrel before retreating to around $78 as physical oil flows remained undisturbed. “The situation escalated notably after the U.S. joined Israel in striking Iranian nuclear facilities, leading to fears of supply disruptions, particularly concerning the strategic Strait of Hormuz,” said Nirpendra Yadav, Sr. Commodity Research Analyst at Bonanza.

Despite the negative sentiment, foreign institutional investors turned buyers, purchasing local shares worth over ₹10,000 crore in the past four sessions. “FIIs turning out buyers of local shares worth over ₹10,000 crore in the past 4 sessions shows that India’s strong fundamentals continue to attract foreigners despite global uncertainty,” Tapse added.

Looking ahead, market participants expect continued volatility. “Volatility is expected to persist as geopolitical developments continue to steer market sentiment,” said Vikram Kasat, Head - Advisory, PL Capital. “Going forward, index to maintain positive bias and gradually head towards 25,200–25,250 levels in the coming sessions being the upper band of the last five weeks consolidation range,” noted analysts at Bajaj Broking, adding that immediate bias remains positive above 24,700-24,800 levels.

Published on June 23, 2025