Markets: Geodynamic uncertainties drag Sensex, Nifty down over 1.4%

Virendra Pandit

New Delhi: Fears of a fresh US-Iran war, uncertainties over a peace deal between them, and deepening market anxiety dragged Indian equity benchmarks down by more than 1.4 per cent on Friday.

While the Nifty 50 fell 359.40 points (1.5 per cent) to close at ⁠23,547.75, the BSE Sensex shed 1092.06 points (1.44 per cent) to end at 74,775.74, taking their monthly losses to 1.9 per cent and 2.8 per cent, respectively.

The lingering uncertainty over a US-Iran peace deal due to renewed fighting prompted investors to lock in gains after the previous month’s strong rally.

Brent Crude futures fell 19 per cent in May, but remain 27.3 per cent above the levels seen before the ⁠Iran war started on February 28. India is the world’s third biggest crude importer. Elevated oil prices and a lack of AI trade have kept the Indian market out of favor among foreign investors, analysts said.

Ten of the 16 major sectors logged monthly losses. Broader markets outperformed, with the small-cap and mid-cap indexes rising 0.7 per cent and 3.2 per cent, respectively, on earnings optimism.

Among the top gainers was Adani Enterprises which surged 22 per cent after the US dropped alleged fraud charges against Group Chairman Gautam Adani. Hindalco and National Aluminum gained 8.6 per cent and 6.3 per cent as steady domestic demand, pricing comfort and global supply worries linked to the Iran war lifted metal prices.

Top losers included heavyweight financials and IT stocks which lost 1.2 per cent and 0.9 per cent. Reliance Industries shed 7.7 per cent. ONGC fell ‌11.4 per cent on profit booking after a 25 per cent rise over the previous four months, and on concerns over production delays at key projects. ITC declined 8.9 per cent as analysts flagged that ⁠recent price hikes will likely weigh on cigarette volumes in June.

At the interbank foreign exchange market, the Indian rupee opened at 95.77 against the US dollar, then touched an intraday high of 94.97 and a low of 95.78 during the day. At the end of Friday’s trading session, the rupee was quoted at 95.05 (provisional), up 53 paise from its previous close.