Israel-Iran conflict: Should stock market investors be worried after Sensex, Nifty 50 crash? EXPLAINED
Israel-Iran conflict: Indian benchmark equity indices tumbled in early trading on Friday, tracking steep declines in Asian markets following Israel's military strikes on Iran, which intensified geopolitical tensions in the oil-rich Middle East.
The Sensex began the session at 80,427.81, down from its previous close of 81,691.98, and plunged over 1,300 points, or 1.6%, reaching an intraday low of 80,354.59. Similarly, the Nifty opened at 24,473, compared to its prior close of 24,888.20, and tumbled 1.7% to hit an intraday low of 24,473.
Among the sectors, Nifty Oil & Gas emerged as the biggest loser, sliding 1.6% due to significant declines in stocks like Mahanagar Gas, IGL, BPCL, and IOC. Other indices including Nifty Bank, IT, Auto, Metal, and PSU Bank also saw losses, each falling between 1% and 1.5%. In the broader market, the Nifty Midcap index shed 1.1%, while the Nifty Smallcap100 declined by 1.5%.
'Geopolitical tensions, such as the ongoing Iran-Israel conflict, have historically caused short-term market volatility. This often presents attractive opportunities to acquire high-quality stocks at discounted prices. We believe that any resulting volatility is temporary and unlikely to persist in the long term,' said Rajesh Palviya, SVP - Technical and Derivatives Research, Axis Securities.
According VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, the impact on market will depend on how long the conflict lingers. In the near-term the market will be in a risk-off mode.
'Investors can wait and watch how the situation unfolds. Nifty is likely to get strong support at 24500 level,' Vijaykumar added.
Rajesh Palviya of Axis Securities believe that any market corrections driven by geopolitical concerns as a buying opportunity. 'Technically, the Nifty index has strong support in the 24,500–24,300 range, while the Bank Nifty finds support near the 55,000 mark,' he said.
On the other hand, experts recommend investors to avoid leveraged trades or highly speculative positions and Use market corrections as opportunities, not emergencies.
'Geopolitical sell-offs often cause short-term panic but not always long-term market damage, unless the situation escalates into broader war or economic sanctions affecting global trade (especially oil),' said Vikram Kasat, Head - Advisory, PL Capital.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
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