Domestic stock markets remained under pressure in early trade on Thursday, with the Sensex tumbling more than 650 points as investors turned cautious amid surging crude oil prices and escalating uncertainty linked to the ongoing West Asia conflict.
As of 9:37 am, the Sensex was at 77,848.94, down 667.55 points or 0.85%, while the Nifty 50 traded at 24,201.25, lower by 176.85 points or 0.73%.
WHY IS THE STOCK MARKET FALLING TODAY?
The biggest trigger behind today’s weakness is crude oil. Brent crude has climbed back above $100 per barrel, raising fresh concerns for India, which imports most of its crude oil requirements. Higher oil prices can increase inflation, widen the current account deficit, pressure the rupee and hurt corporate earnings.
Dr. VK Vijayakumar said markets are facing an environment of elevated uncertainty. “With total uncertainty becoming the new normal, there is no clarity on the near-term direction of the market,” he said.
He added that with the war lasting longer than expected and Brent crude rebounding to $103, risks are rising for both global growth and India’s macroeconomic outlook.
CRUDE OIL PRICE BACK ABOVE $100/BARREL
“If Brent crude remains at an average of $100 for many months, India’s growth and corporate earnings will take a hit. The market has not discounted this yet,” Vijayakumar said.
Today’s selling was visible across heavyweight sectors such as banking, financials, IT and autos.
Among major Nifty losers in early trade were Tech Mahindra, down 2.64%, Mahindra & Mahindra, down 2.14%, Eternal, down 2.20%, and ICICI Bank, down 1.51%.
IT heavyweights such as Infosys and HCL Technologies were also under pressure, adding to the weakness in headline indices.
Financial stocks remained mixed, with HDFC Bank lower by 0.83%, while State Bank of India slipped 0.51%.
Some defensive and energy names bucked the trend.
Dr. Reddy’s Laboratories rose 4.86%, while ONGC gained 1.53% as higher crude prices tend to support upstream energy producers.
Vijayakumar said the United States was in a different position because it is a net energy exporter.
“The US being a net energy exporter is not impacted by the energy crisis. Corporate earnings in US will continue to be strong. That’s why the S&P 500 and Nasdaq are hitting new record highs,” he said.
Despite weakness in benchmark indices, the broader market has shown relative resilience.
“A significant trend in the Indian market is the outperformance of the broader market where there is no significant pressure of FII selling. In fact, FIIs are buying many stocks in the mid and smallcap segments,” Vijayakumar said.
That suggests investors are selectively buying smaller stocks even as heavyweight shares face pressure.
Traders will now track three immediate triggers. Crude oil prices, developments in West Asia, and ongoing quarterly earnings.
If Brent remains above $100, volatility in domestic equities could stay elevated in the near term.
