Stock indices fall 1% on growing tension in West Asia, rise in crude prices

Indian equity markets fall 1% due to West Asia tensions, with Sensex and Nifty dropping, led by key sectors.

The bearish sentiment continued in the Indian equity markets on Friday with key benchmark indices falling about 1% due to selling on account of growing tension in West Asia.

The S&P BSE Sensex fell 808.65 points, or 0.98%, to 81,688.45, led by M&M (-3.58%), Bajaj Finance (-3.01%), Nestle (-2.85%), Asian Paints (-2.49%) and Bharti Airtel (-2.09%). 

The NSE Nifty-50 index too dropped 235.50 points, or 0.93%, to 25,014.60.

During the week, the Nifty-50 Index and Sensex lost about 4.2% each, making it the worst trading week in over two years while the mid-cap index lost about 3.1% and small-cap index lost 1.8% outperforming large caps.

“Indian markets underperformed most global markets. The Chinese market was up 22% last week, while other major global markets were weak. The increase in geopolitical tensions between Israel and Iran weighed on risk assets, while crude oil rose by $5.5/bbl to $78/bbl,” said Shrikant Chouhan, Head of Equity Research, Kotak Securities. Mounting geopolitical tensions had contributed to a shaky start in October for the stock market, he added.

On Friday’s fall, Vinod Nair, Head of Research, Geojit Financial Services said, “The bearish sentiment continued as investors are monitoring the escalating conflict in the Middle East and have adopted a sell-on recovery strategy.”

Stating that the drag was seen across sectors led by realty, auto, and FMCG, he said the pessimism on the market would continue in the near term amidst rising crude prices and fund flows to cheaper markets like China.