Mumbai: Benchmark indices Sensex and Nifty buckled under selling pressure Tuesday as fresh tensions flared in the Strait of Hormuz region and the ceasefire between the US and Iran came under strain.
The rupee hitting a record low against the US dollar amid elevated crude prices also made investors cautious.
In a volatile session, the 30-share BSE Sensex dropped 251.61 points, or 0.33 per cent, to settle at 77,017.79. During the day, it tanked 754.37 points, or 0.97 per cent, to 76,515.03.
The 50-share NSE Nifty edged lower by 86.50 points, or 0.36 per cent, to end at 24,032.80.
“Domestic equities witnessed a volatile session, closing lower as post-election optimism faded and sentiment re-aligned with global weakness amid rising geopolitical tensions.
“Elevated crude prices continued to pressure the rupee, which slipped to record lows. Despite these headwinds, the ongoing earnings season, with results slightly ahead of expectations, provided some support and triggered selective bottom-fishing,” Vinod Nair, Head of Research, Geojit Investments Limited, said.
From the Sensex firms, ICICI Bank, Eternal, Tech Mahindra, Axis Bank, Bharti Airtel and Larsen & Toubro were among the major laggards.
On the other hand, Mahindra & Mahindra, UltraTech Cement, Bajaj Finserv and Bajaj Finance were top gainers.
In the broader market, the BSE MidCap Select index dipped 0.12 per cent, while the SmallCap Select index went up marginally by 0.14 per cent.
Sectorally, Realty dropped 1.38 per cent, Top 10 Banks (0.79 per cent), Services (0.63 per cent), Consumer Durables (0.62 per cent), Private Banks (0.60 per cent) and Bankex (0.58 per cent).
In contrast, Power, FMCG, Commodities, Healthcare, IT, Telecommunication, Utilities, Auto, Capital Goods, Focused IT and MidSmall Private Banks Quality Tilt were the gainers.
“On Tuesday, Indian markets came under pressure amid escalating tensions in West Asia and the rupee hitting all-time lows. Iran intensified attacks in the Middle East, targeting critical energy infrastructure in the UAE, raising concerns over supply disruptions,” Siddhartha Khemka – Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd, said.
On the political front, the outcome of multiple state elections is expected to be viewed positively by the market, he said.
“These results carry longer-term implications for economic growth across the involved states, particularly in West Bengal, where structural changes could unfold over time,” Khemka added.
Drone strikes caused a fire at a major oil industry zone in the United Arab Emirates’ port city of Fujairah on Monday. The UAE had accused Iran of carrying out the strike.
Brent crude, the global oil benchmark, traded around the USD 113 per barrel mark.
Meanwhile, the rupee slipped 2 paise to an all-time low of 95.25 (provisional) against the US dollar on Tuesday.
Markets were closed in South Korea, Japan and mainland China. Hong Kong’s Hang Seng index ended lower.
Markets in Europe were trading mostly higher.
US markets ended lower on Monday.
Foreign Institutional Investors (FIIs) turned buyers on Monday, buying equities worth Rs 2,835.62 crore, according to exchange data.
In a mandate as sweeping as it is symbolic, the BJP Monday scripted history by winning 206 seats to secure more than a two-thirds majority in the West Bengal assembly polls, ending the TMC’s 15-year rule, and decisively shifting the state’s ideological and political centre of gravity.
On Monday, the Sensex climbed 355.90 points, or 0.46 per cent, to settle at 77,269.40. The Nifty rallied 121.75 points, or 0.51 per cent, to end at 24,119.30.