Markets Slide as West Asia Tensions Escalate

Mumbai: Indian stock markets opened the week on a bearish note as escalating geopolitical tensions in West Asia triggered a wave of panic selling. The benchmark BSE Sensex tumbled by over 800 points in early trading on Monday, while the NSE Nifty slipped below the crucial 24,900 mark, reflecting heightened investor anxiety over potential global economic disruptions.

This downturn follows last Friday’s strong rally, when the Sensex had surged by 1,046 points and the Nifty jumped over 319 points due to positive domestic cues. However, the weekend developments in the Middle East — particularly Iran’s move to close the Strait of Hormuz after a U.S. strike — have spooked investors across global markets.

As oil prices soar and fears of supply chain disruptions mount, foreign institutional investors (FIIs) turned cautious, leading to heavy outflows from Indian equities. The energy, auto, and financial sectors bore the brunt of the selloff, with heavyweights like Reliance Industries, HDFC Bank, and Tata Motors losing between 2–4% in morning trade.

Market analysts believe the current volatility may persist if diplomatic resolutions are not achieved soon. “The closure of the Strait of Hormuz is a serious global supply threat. For India, which imports over 80% of its oil, this could mean inflationary pressure and fiscal stress in the near term,” said Devansh Sheth, a senior analyst at Mumbai-based CapitalEdge.

In addition to global tensions, concerns over monsoon progress and upcoming corporate earnings have also contributed to cautious investor sentiment. Small-cap and mid-cap indices also witnessed sharp corrections, dragging the overall market breadth into negative territory.

Gold prices, on the other hand, rose sharply as investors moved toward safe-haven assets. The rupee also weakened slightly against the US dollar due to a spike in crude prices and global risk-off sentiment.

The Indian government and RBI are reportedly monitoring the situation closely. Finance Ministry sources indicated that contingency plans are being reviewed in case crude prices cross critical thresholds.

Until stability returns to global geopolitics, investors are advised to stay cautious and avoid speculative bets. The broader market outlook remains uncertain, with volatility expected to dominate trading patterns through the week.