Indian shares extended their slump on Wednesday, while the rupee hit a lifetime low and bonds slid as the Middle East conflict sent oil prices higher, raising inflation concerns and rattling financial markets globally.
The Nifty 50 fell 1.55% to a six-month closing low of 24,480.50 and the BSE Sensex shed 1.4% to an 11-month low of 79,116.19. The benchmarks have lost about 4% each in three sessions.
Other Asian markets slid 4.1%, with a record-breaking market crash in South Korea, on worries that a wider Middle East war could deliver an energy shock that raises inflation and delays rate cuts. [MKTS/GLOB]
Brent crude futures rose 3.1% to $83.95 a barrel by 10:00 GMT. They have gained about 18.7% in four sessions. [O/R]
A sustained rise in crude oil prices could push up inflation and hurt growth in India, which imports 80% of its crude needs.
“For India, any sharp spike in oil prices has implications for current account deficit, fiscal deficit and inflation, while also placing downward pressure on the rupee,” Macquarie analysts, led by Suresh Ganapathy, said.
Fifteen of the 16 major sectors logged losses on Wednesday. The broader small- and mid-caps lost 2.1% and 2.2%, respectively.
The Nifty India volatility index jumped to 21.14, settling at its highest level since May 9, 2025, indicating a spike in investor anxiety.
“The Middle East conflict is dominating sentiment for now and markets always take the easy way out, which is to exit when in doubt,” said Arun Kejriwal, founder of Kejriwal Research and Investment Services.
“In the near term, fresh investments are unlikely as investors will be cagey and pruning portfolios,” Kejriwal said, adding that though India could find some relief on crude through Russian imports and domestic inflows may offer support, stocks where earnings are hit from recent disruptions will be hammered.
Russian Deputy Prime Minister Alexander Novak said on Wednesday that Moscow was ready to increase oil supplies to China and India, according to Interfax news agency.
Among individual stocks, Larsen and Toubro, which has significant exposure to the Middle East, tumbled 4.5% after losing 5% in the previous session.
Nifty heavyweights HDFC Bank and ICICI Bank lost 1.2% and 0.6%, respectively, while oil-to-telecom conglomerate Reliance Industries fell 1%.
Oil marketing companies, such as Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Indian Oil Corporation lost about 4.8%-5.5%.
Tyre makers such as MRF, JK Tyre and Ceat lost 2.7%-8%.
Airline operator Interglobe Aviation dipped 2.8% after losing 6.4% in the previous session as the conflict forced domestic carriers to cancel flights to the Middle East and parts of Europe.
