Indian equity markets remained poised for a sharply negative start on Monday, with benchmark indices sliding steeply in the pre-open session as escalating geopolitical tensions in West Asia and a surge in crude oil prices rattled global risk sentiment.
The BSE Sensex opened the trading week around 77k, dramatically tanking over 1,800 points, while the NSE Nifty50 rang the opening bell for the session near 23,900, nosediving more than 550 points, as of 9:15 AM.
On the 30-share Sensex, it was a complete washout, with IndiGo crashing 6.7 per cent, Tata Steel and L&T bleeding close to 5 per cent each, and SBI down 4.7 per cent in the opening hour.
In the broader markets, the Nifty Bank led the negative sentiment and plunged 3.86 per cent. Sectorally, the PSU Bank index plummeted more than 5 per cent, followed by the Financial Services 25/50 index which took a hit of 3.79 per cent.
At around 9:08 AM in the pre-open session, the Sensex was trading at 77,053.34, nosediving 1,865.56 points or 2.36 per cent. The Nifty stood at 23,868.05, lower by 582.40 points or 2.38 per cent, indicating a gap-down opening for domestic equities.
The weak pre-open signals come after a turbulent previous week in which markets faced heavy selling pressure amid rising geopolitical uncertainty and a sharp spike in global crude oil prices.
West Asia Conflict And Oil Price Surge In Focus
Analysts expect developments related to the ongoing conflict in West Asia and its impact on crude oil prices to remain the key drivers for markets this week.
Brent crude, the global oil benchmark, jumped 8.52 per cent to $92.69 per barrel, raising concerns for energy-importing economies such as India. Higher oil prices typically weigh on inflation, the fiscal balance and the rupee, making investors cautious.
“The week ahead is likely to remain volatile, with market sentiment largely shaped by persistent geopolitical tensions in the Middle East. Investors will closely track global developments, particularly movements in crude oil prices, as energy markets continue to play a critical role in influencing overall risk appetite,” said Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm.
Key Macro Data To Guide Near-Term Sentiment
Apart from geopolitical developments, investors will also keep a close watch on important domestic macroeconomic indicators scheduled for release this week.
Ajit Mishra, SVP – Research at Religare Broking Ltd, said market participants will closely monitor the Consumer Price Index (CPI) inflation data due on March 12, which could provide cues on inflation trends and monetary policy expectations.
He added that movements in global crude oil prices and broader global market trends will remain crucial external variables influencing market direction in the coming days.
FII Outflows Continue To Pressure Markets
Foreign investor activity has remained a key factor behind recent market weakness. Foreign investors pulled out nearly Rs 21,000 crore (around $2.3 billion) from Indian equities over the last four trading sessions amid the intensifying West Asia crisis.
According to V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, the combination of geopolitical uncertainty, elevated crude oil prices, a weakening rupee and sustained market declines has contributed to persistent foreign institutional investor (FII) selling in the cash market.
“FPIs are unlikely to return to the market as buyers until there is some clarity on the outcome of the conflict and decline in the price of crude,” Vijayakumar said, adding that Brent crude trading above $90 is negative for the Indian economy and markets.
Markets End Previous Week With Heavy Losses
Domestic equities ended the holiday-shortened previous week with steep losses as global tensions escalated and oil prices surged.
For the week, the BSE Sensex plunged 2,368.29 points or 2.91 per cent, while the NSE Nifty dropped 728.2 points or 2.89 per cent.
Market participants said the sharp spike in crude oil prices and uncertainty around geopolitical developments significantly dampened investor sentiment.
Geopolitical risks intensified after the US and Israel launched military strikes on Iran on February 28, killing Ayatollah Ali Khamenei, Iran’s supreme leader. Following the offensive, Iran carried out a series of retaliatory attacks targeting Israeli and American military bases across several Gulf countries including the UAE, Bahrain, Kuwait, Jordan and Saudi Arabia.
These developments have heightened fears of a broader regional conflict, which could disrupt energy markets and global trade flows, adding another layer of uncertainty for financial markets.
