Sensex, Nifty Close Down 1% As Crude Spike Hits Sentiment
Indian benchmark equity indices ended lower on Thursday, extending their losing streak for the second straight session, as surging crude oil prices and escalating geopolitical tensions in the Middle East weighed on investor sentiment.The BSE Sensex declined 829.29 points, or 1.08 per cent, to settle at 76,034.42, while the NSE Nifty 50 fell 227.70 points, or 0.95 per cent, to close at 23,639.15. During intraday trade, the Sensex dropped as much as 992.53 points, or 1.3 per cent, to hit a low of 75,871.18, while the Nifty slipped 298.15 points, or 1.25 per cent, to 23,556.30.
The weakness was largely led by auto, banking and NBFC stocks, which came under heavy selling pressure amid fears that elevated oil prices could fuel inflation and dampen demand. The latest fall follows a nearly 1.7 per cent decline in the benchmark indices in the previous session, highlighting persistent caution among investors.
The market downturn also eroded investor wealth significantly. The total market capitalisation of BSE-listed firms dropped by around Rs 14 lakh crore to nearly Rs 436 lakh crore from about Rs 450 lakh crore last week.
Global Cues Weigh On Markets
Weak global signals added to the pressure. US stock index futures traded lower as crude oil prices surged towards the USD 100-per-barrel mark, heightening concerns over inflation and reducing expectations of near-term interest rate cuts. Futures linked to the S&P 500 and Nasdaq 100 declined about 0.5 per cent, indicating a subdued start for Wall Street.
European markets also remained under pressure, with the STOXX 600 index slipping 0.5 per cent. The MSCI All-World index edged down 0.3 per cent, reflecting broad-based risk aversion across global equities.
Asian markets followed the negative trend. The MSCI Asia Pacific Index declined 1.3 per cent, while the MSCI Emerging Markets Index also dropped 1.3 per cent. Hong Kong’s Hang Seng index fell 0.9 per cent, though China’s Shanghai Composite remained largely unchanged.
Oil Volatility Remains Key Risk
Oil prices remained the central driver of market volatility. Brent crude futures surged more than 10 per cent at one point to touch highs of USD 101.59 per barrel after reports of attacks on fuel-oil tankers and disruptions at key oil ports amid the ongoing US-Israeli conflict with Iran.
Although the International Energy Agency agreed to release a record 400 million barrels of oil from strategic reserves to stabilise markets, supply concerns persisted. Iranian officials warned that crude prices could potentially rise to USD 200 per barrel, while vessel traffic through the Strait of Hormuz — a crucial global oil transit route — declined sharply.
Investors are also closely tracking geopolitical developments. Data from prediction platform Polymarket showed that the probability of a US-Iran ceasefire by 31 March fell to 26 per cent from 45 per cent earlier this week, adding to uncertainty.
Analysts said market direction in the near term will depend largely on crude price trends and the evolution of the Middle East conflict, even as domestic fundamentals remain relatively supportive.
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