Rising tensions between Israel and Iran weighed on market sentiment on Thursday, dragging down Indian equities and broader indices. By 1 PM, both Sensex and Nifty were trading flat with a slight downward bias. The Sensex was down 43 points at 81,401.51, while the Nifty slipped 18.80 points to trade at 24,793.25.
However, the broader market bore the brunt of the sell-off, with the BSE SmallCap index plunging 1,049 points or nearly 2% to 51,984.13 in the afternoon trase. The BSE MidCap index also fell sharply, losing 799.59 points or 1.75% to 44,890.94.
The global mood remained cautious, with Dow Jones Industrial Average futures falling by 224 points, or 0.53%, to 41,964. Geopolitical concerns in West Asia and the risk of energy supply disruptions kept crude oil prices elevated, further adding to investor worries.
Markets open today
Indian equity indices opened Thursday’s trading session on a muted note as tensions in West Asia entered the seventh day and the US Federal Reserve kept the key lending rates unchanged. The NSE Nifty 50 opened flat at 24,812, while the BSE Sensex opened 19 points, or 0.02%, lower at 81,425.
In line with the overall markets, Bank Nifty opened 69 points or 0.12% lower at 55,760. The Nifty Midcap 100 opened 50 points or 0.09% higher at 58,159.
“The 24,500-25,000 range for the Nifty is likely to hold till news from the Israel-Iran conflict changes for the better or for the worse. If news of the de-escalation of tensions breaks, Nifty will break out of the upper band of the range. If the news is about the escalation of tensions, particularly relating to troubles in the Strait of Hormuz resulting in a sharp spike in crude, it would be difficult for Nifty to hold on to the 24,500 support level. So watch out for the developments in West Asia,” said VK Vijayakumar, Chief Investment Strategist at Geojit Investments.
“The Fed decision and commentary have come on expected lines. Jerome Powell’s comment that “ despite heightened uncertainty, the economy is in a solid position “ is important,” added Vijayakumar.
Here are key highlights from the early session-
Top performers leading the charge
Among the top gainers on the Nifty 50 were Wipro, Eicher Motors, Grasim, Titan, and Apollo Hospitals. The top movers in the Nifty 50 were HDFC Bank, Kotak Mahindra Bank, M&M, L&T, and Reliance Industries as soon as markets opened.
Stocks in the red
The stocks that remained under pressure included Tech Mahindra, Adani Ports, IndusInd Bank, Infosys, and HCL Technologies were the laggards in the morning trade.
Iran – Israel conflict
The Israel-Iran conflict stretches into its seventh day, tensions continue to rise with both nations trading strikes. Israel claims to have targeted military sites in Tehran, while Iran says it has launched ballistic missiles toward Israel. In the US, President Donald Trump convened a Situation Room meeting on Wednesday to evaluate America’s response. While he stated that his “patience has already run out” with Tehran, he has yet to make a final decision on direct involvement. Meanwhile, Iran’s Supreme Leader Ayatollah Ali Khamenei vowed not to surrender and warned that any US military action would cause “irreparable damage.
US Federal Reserve
The US Federal Reserve has once again decided to keep interest rates steady, marking the fourth consecutive meeting without a change. While the central bank still expects to cut rates twice by the end of 2025, officials are now more divided, with some predicting no cuts at all this year. In its latest economic outlook, the Fed also revised its forecasts – projecting slower growth, slightly higher unemployment, and stickier inflation than it had anticipated in March.