Business
Sensex, Nifty slide as crude oil, Gulf tensions rattle investors
Sensex closed 382.62 points lower at 76,132.81 and Nifty settled at 23,779.15 on Monday, as rising crude oil prices and US-Iran tensions weighed on investor sentiment.
The Sensex and Nifty slid on Monday as rising crude oil prices and Gulf tensions rattled investors through the session.
The Sensex closed at 76,132.81, down 382.62 points from Friday’s 76,515.43, while the Nifty settled at 23,779.15, down 118.55 points from 23,897.70.
The US-Iran standoff around the Strait of Hormuz has kept crude prices elevated, a key concern for oil-importing economies like India.
Expectations of another Federal Reserve rate hike, following stronger US jobs data, also weighed on the broader market mood.
Stronger-than-expected US jobs data released over the weekend increased expectations that the Federal Reserve could raise interest rates again, further denting risk appetite in emerging markets including India.
The Nifty had struggled to sustain above the 24,000 mark in recent sessions, facing technical resistance near 24,025 even before Monday’s decline.
Both benchmark indices had closed higher in the previous session on Friday, with the Sensex at 76,515.43 and the Nifty at 23,897.70, before Monday’s reversal.
Bank Nifty and other rate-sensitive indices also traded weak through the session, tracking the broader risk-off mood among investors.
Market participants said they would watch upcoming US Federal Reserve commentary and further developments in the Gulf region for cues on near-term direction.
Brent crude approached $97 a barrel during the session, its highest level in months, as the escalating US-Iran standoff around the Strait of Hormuz raised fears of supply disruption from the Gulf.
IT stocks were the worst-hit sector, since higher US interest rates weigh on Indian technology firms that generate a large share of their revenue from American clients.
Oil-sensitive sectors including aviation, paints, tyres and logistics also came under pressure as elevated crude prices raise input and fuel costs for these industries.
Foreign institutional investors were net sellers in Indian equities during the session, adding to the downward pressure alongside the global cues.
Bombay Stock Exchange building, Mumbai, Wikimedia Commons, CC BY 2.0