Benchmark equity indices fell by around 1% on Monday, hitting two-month lows amid renewed geopolitical tensions between Israel and Iran leading to a sharp rise in Brent crude prices at almost $98 a barrel.

Extending losses for a second consecutive session, the Sensex dropped 719.08 points, or 0.97%, to close at 73,524.26 after a volatile trading session. The Nifty declined 243.70 points, or 1.04%, to end at 23,123.00.

Despite the decline, Indian markets outperformed several regional peers. South Korea’s benchmark index plunged 8.3%, while Japan and Taiwan fell 3.85% and 3.48%, respectively, amid concerns over the sustainability of the artificial intelligence-led rally and the impact of higher crude oil prices.

“The sell-off was primarily triggered by a sharp correction in global equities and a spike in crude oil prices following renewed geopolitical tensions in the Middle East,” said Ajit Mishra, Senior Vice-President, Research, Religare Broking.

“Iran’s missile strikes on Israel in retaliation for Israel’s actions in Lebanon have pushed Brent crude prices higher, raising concerns over inflation and external sector pressures,” said Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services.

Investors suffered a notional loss of ₹6.31 lakh crore as the total market capitalisation of BSE-listed companies declined to ₹455.3 lakh crore.

Market breadth remained weak, with 3,117 stocks declining against 1,249 advances on the BSE. The broader market underperformed the benchmarks, with the BSE MidCap and SmallCap indices falling 1.72 per cent and 1.82 per cent, respectively.

Barring healthcare, all sectoral indices on the NSE ended lower. Realty, metals, auto, oil and gas, and consumer durables were the worst-performing sectors, declining by as much as 2.56 per cent.

Among Sensex constituents, InterGlobe Aviation (IndiGo), Eternal, Mahindra & Mahindra, Reliance Industries and TCS were the top losers. BEL, Power Grid, Tech Mahindra, Bharti Airtel and SBI were among the gainers.

Foreign portfolio investors sold shares worth ₹5,555.67 crore, while domestic institutional investors bought shares worth ₹5,165.24 crore, according to provisional BSE data.