Indian stock markets witnessed a sharp decline on Monday, with the benchmark Sensex falling more than 500 points and the Nifty slipping below the 23,250 level amid concerns over rising geopolitical tensions in the Middle East and surging global crude oil prices.
The sell-off came after fresh hostilities involving Iran and Israel triggered fears of disruptions in global oil supplies, sending crude prices sharply higher. Investors remained cautious as rising energy costs could increase inflationary pressures and affect economic growth prospects.
During the session, selling pressure was seen across several sectors, particularly in aviation, consumer goods and automobile stocks. Shares of InterGlobe Aviation (IndiGo) came under pressure as higher fuel prices are expected to raise operating costs for airlines. Asian Paints also declined as investors worried about the impact of rising crude-linked raw material costs on profit margins.
However, energy-related stocks bucked the broader market trend. Reliance Industries and ONGC emerged among the key gainers as investors anticipated that higher crude prices could benefit oil and gas producers. Buying was also visible in select energy counters as traders sought refuge in sectors likely to gain from elevated oil prices.
Market experts said investor sentiment remained fragile due to uncertainty surrounding the Middle East conflict. India, being one of the world’s largest crude oil importers, is particularly vulnerable to sustained increases in energy prices. Higher oil costs can raise transportation and manufacturing expenses, putting pressure on both businesses and consumers.
The weakness in equities was accompanied by pressure on the Indian rupee, which traded lower against the US dollar due to concerns over a rising import bill. Foreign investor activity also remained in focus as traders assessed the potential impact of global developments on emerging markets.