Sensex Tumbles 530 Points, Nifty Slips Below 24,250 as US-Iran Tensions Weigh on Markets

The domestic equity benchmarks opened sharply lower on Wednesday as rising geopolitical tensions in the Middle East, higher crude oil prices and caution ahead of the June-quarter earnings season weighed on investor sentiment.

Selling pressure was broad-based, with banking, auto, financial and oil & gas stocks leading the decline, while pharma stocks bucked the trend. At 9:31 am, the BSE Sensex was down 538.32 points, or 0.69 per cent, at 77,642.40. The NSE Nifty50 fell 171.95 points, or 0.70 per cent, to 24,226.75.

The weakness extended to the broader market, although mid- and small-cap stocks outperformed the frontline indices. The Nifty Next 50 slipped 0.79 per cent, the Nifty 100 declined 0.72 per cent and the Nifty 200 fell 0.65 per cent. The Nifty Midcap 100 and Nifty Smallcap 100 were down 0.38 per cent and 0.27 per cent, respectively.

Market volatility also picked up, with the India VIX rising nearly 7 per cent to 12.45 as investors assessed the implications of the latest geopolitical developments.

Global Jitters Weigh on Sentiment

Investor sentiment turned cautious after renewed military action by the United States against Iran heightened concerns over stability in the Middle East. The escalation also pushed crude oil prices higher, with Brent crude climbing 2.6 per cent to around $76.1 a barrel after gaining 3 per cent in the previous session, raising fears of potential disruptions to global energy supplies.

Asian markets traded mostly lower following overnight weakness on Wall Street, adding to the risk-off mood across global equities.

Pharma Defies Market Weakness

Sectoral performance remained mixed, with defensive stocks attracting buying interest.

The Nifty Pharma index emerged as the top gainer, advancing 1.12 per cent, while the Nifty Healthcare Index rose 0.97 per cent. Nifty IT was largely unchanged, trading marginally in positive territory.

Among the laggards, Nifty Oil & Gas dropped 1.75 per cent, followed by PSU Bank (-1.34 per cent), Auto (-1.26 per cent), FMCG and Media, both of which declined more than 0.9 per cent.

On the Sensex, IndiGo was among the biggest losers, falling nearly 2.8 per cent. Asian Paints, Bajaj Finance, Reliance Industries, SBI, Mahindra & Mahindra and Maruti Suzuki also traded in the red.

Sun Pharma led the gainers, followed by HCLTech, Tech Mahindra, Power Grid and Infosys.

Analysts See Consolidation, Not Trend Reversal

Despite the weak opening, analysts believe the broader market structure remains positive.

Hitesh Tailor, Research Analyst at Choice Equity Broking, said the Nifty is undergoing a healthy consolidation after its recent rally rather than showing signs of a reversal.

He believes the index is likely to maintain its bullish bias as long as it holds above the crucial 24,000-24,200 support zone. On the upside, the 24,500-24,600 range remains the immediate resistance, with a decisive breakout required to trigger the next leg of the rally.

Ponmudi R, CEO of Enrich Money, said markets are expected to remain cautious as investors monitor the impact of fresh US-Iran tensions on global risk sentiment and crude oil prices.

He added that sustained buying by Foreign Institutional Investors (FIIs), who have turned net buyers in recent sessions, will be crucial in helping domestic markets absorb global uncertainties and sustain their recovery.

Technical Indicators Remain Supportive

From a technical perspective, Tailor noted that while the Nifty formed a bearish candlestick in the previous session, key momentum indicators continue to favour the bulls.

The index remains above most of its major moving averages, with the 10-day EMA crossing above the 100-day EMA, signalling positive medium-term momentum. The Relative Strength Index (RSI) remains above 63, while the MACD continues to trade above both its signal line and the zero line.

According to options data, immediate support is seen in the 24,200-24,000 zone, while resistance remains at 24,500-24,600. A sustained move above this range could revive bullish momentum once the ongoing consolidation phase concludes.