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Business Recorder
14 hours ago
- Business
- Business Recorder
Indian markets set for muted open as Middle East tensions spur caution
India's equity benchmarks are poised for a subdued start on Friday, in line with broader Asian markets, as escalating tensions between Israel and Iran continue to rattle global investor sentiment. The Gift Nifty futures were trading at 24,777.5, as of 7:46 a.m. IST, indicating that the Nifty 50 will open near the previous close of 24,793.25. Both the Nifty and Sensex indexes ended flat in the previous session, while the broader markets fell on risk-aversion mode. Asian peers opened subdued on Friday after reports that Israel had bombed Iranian nuclear sites, triggering retaliatory missile and drone strikes from Iran. The White House said US President Donald Trump would decide within two weeks whether the US would back Israel militarily. Wall Street equities were closed on Thursday. Indian shares subdued as Middle East conflict saps risk appetite 'Investors are treading cautiously, with fears of US involvement adding a fresh layer of uncertainty to an already volatile environment,' said Vinod Nair, Head of Research at Geojit Financial Services. Domestic institutional investors (DII) remained net buyers of Indian stocks for the 23rd consecutive session on Thursday, with net inflows of 11.13 billion rupees ($128 million) in the previous session, cushioning volatile foreign flows and lending liquidity support to the markets.
Mint
17 hours ago
- Business
- Mint
Indian markets set for muted open as Middle East tensions spur caution
June 20 (Reuters) - India's equity benchmarks are poised for a subdued start on Friday, in line with broader Asian markets, as escalating tensions between Israel and Iran continue to rattle global investor sentiment. The Gift Nifty futures were trading at 24,777.5, as of 7:46 a.m. IST, indicating that the Nifty 50 will open near the previous close of 24,793.25. Both the Nifty and Sensex indexes ended flat in the previous session, while the broader markets fell on risk-aversion mode. Asian peers opened subdued on Friday after reports that Israel had bombed Iranian nuclear sites, triggering retaliatory missile and drone strikes from Iran. The White House said U.S. President Donald Trump would decide within two weeks whether the U.S. would back Israel militarily. Wall Street equities were closed on Thursday. "Investors are treading cautiously, with fears of U.S. involvement adding a fresh layer of uncertainty to an already volatile environment," said Vinod Nair, Head of Research at Geojit Financial Services. Domestic institutional investors (DII) remained net buyers of Indian stocks for the 23rd consecutive session on Thursday, with net inflows of 11.13 billion rupees ($128 million) in the previous session, cushioning volatile foreign flows and lending liquidity support to the markets. ** Mastek launches a comprehensive suite of AI solutions aimed at driving enterprise-wide AI adoption ** Nestle India says it will consider issuing bonus shares at a board meeting scheduled on June 26 ** ITD Cementation secures contracts worth 9.6 billion rupees ** HDFC Bank's unit HDB Financial Services sets a price band of 700-740 rupees per share for its initial public offering; issue to run from June 25-27 ($1 = 86.8130 Indian rupees) (Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sherry Jacob-Phillips)
Hans India
a day ago
- Business
- Hans India
Sensex, Nifty end lower; Mid & Small-caps crash: Should you buy the dip?
Indian stock markets ended on a cautious note on Thursday, June 19, as frontline indices Sensex and Nifty 50 slipped slightly, while mid- and small-cap stocks took a severe beating. The BSE Midcap index tanked 1.64% and the Smallcap index plunged 1.77%, wiping out nearly ₹4 lakh crore in investor wealth in just one session. The Sensex declined by 83 points or 0.10%, to close at 81,361.87, while the Nifty 50 ended 19 points or 0.08% lower at 24,793.25. The sharp correction in the broader market was triggered by escalating geopolitical tensions between Israel and Iran, with US President Donald Trump warning that it might be too late for Iran to negotiate and teasing a major announcement next week. These developments kept investor sentiment fragile. In parallel, the US Federal Reserve kept its policy rate unchanged at 4.25%–4.50%, while painting a worrying picture of persistent inflation and slower growth — raising global stagflation concerns. This particularly impacted Indian software and export-oriented stocks. 'Markets stayed rangebound with a negative tilt as global fears over US involvement in the Middle East weighed heavily. The Fed's signals of sticky inflation also dampened risk appetite,' said Vinod Nair, Head of Research at Geojit Financial Services. Top Gainers on Nifty 50: Tata Consumer: +2.14% Eicher Motors: +1.71% Mahindra & Mahindra: +1.58% Top Losers on Nifty 50: Adani Ports: -2.52% Bajaj Finance: -2.29% Shriram Finance: -2.08% In total, 33 stocks on the Nifty 50 closed in the red. Sectoral Snapshot: Only Nifty Auto ended higher, up 0.52%. All other indices closed in the red: Nifty PSU Bank: -2.04% Nifty Media: -1.91% Nifty Realty: -1.60% Nifty Metal: -1.29% Nifty Bank: -0.45% Financial Services: -0.38% Private Bank Index: -0.30% Investor Wealth Erosion: The total market capitalization of BSE-listed companies fell from ₹446.3 lakh crore to ₹442.5 lakh crore — a single-day erosion of ₹4 lakh crore.
Mint
3 days ago
- Business
- Mint
Iran-Israel war: Are small-cap stocks most exposed to Middle East tensions amid high valuations?
Indian stock market: Geopolitical tensions are once again flaring up in the Middle East, as hostilities between Iran and Israel continue for the fifth consecutive day, making investor sentiment jittery towards riskier assets. Global markets have been on edge, with the conflict adding fresh strain to an already fragile global economy, one that is still grappling with the effects of trade tensions and the ongoing Russia–Ukraine war. For the Indian stock market, the Iran–Israel conflict has added to existing concerns around stretched valuations. Although India does not have significant trade dependence on either country, the tensions have triggered a sharp spike in crude oil prices, dampening market sentiment. While local equities initially reacted negatively to the developments, they later rebounded sharply, with strong resilience in large-cap stocks providing much-needed support to frontline indices, helping them trade higher despite global concerns. During periods of heightened market volatility, stocks with rich valuations tend to correct more than those with reasonable valuations. Although the overall market appears stretched following a sharp rally over the last three months, analysts believe small-cap stocks may face further pain if geopolitical tensions persist, as they are more richly valued compared to large-cap counterparts. Vinod Nair, Head of Research at Geojit Financial Services, said, 'Despite ongoing geopolitical tensions between Israel and Iran, the market moved higher, supported by gains in large-cap stocks, as investors maintained their focus on long-term fundamentals during volatile times. Geopolitical developments in the Middle East are likely to influence near-term market sentiment, with any signs of de-escalation being closely monitored. Small-cap stocks are expected to underperform in the short term, given their elevated valuations and lack of immediate triggers.' Recent data also indicates a shift in retail investor preference towards large-cap stocks, with ownership in mid- and small-cap counters falling to a nine-quarter low amid a broader market sell-off during the March 2025 quarter, according to the NSE report titled 'India Ownership Tracker.' Meanwhile, allocation towards large caps has risen, reflecting a growing inclination for the relative safety of blue-chip stocks amid market turbulence. According to the domestic brokerage firm Kotak Institutional Equities, small caps witnessed the largest cuts on their FY2026 EPS estimates. The brokerage notes that continued weakness in parts of the economy has resulted in continued downgrades to consensus earnings across market caps for FY2026E/27E. However, small caps lead the EPS cuts with a 6% cut in their FY2026 EPS estimates versus 2% for large caps and 3% for mid-caps. The downward revisions have been broad-based, with consumer-facing businesses seeing larger cuts. The same can be seen in earnings cuts of individual stocks of the Nifty 500 Index, with 70% of stocks seeing downgrades versus 30% of stocks seeing upgrades over April-June 2025, noted the brokerage. The Nifty SmallCap 100 is trading at a 1-year forward price-to-earnings (P/E) multiple of 27.2x, significantly higher than its long-term average and much closer to the Nifty MidCap 100's P/E of 28.3x. The spike in Nifty small-cap-100 forward P/E valuation to near mid-caps and at a premium to Nifty-50 This is unusual, as small-cap stocks typically trade at a discount to mid-caps due to their higher risk profile and lower liquidity. The sharp rise in valuations places the index near its historical peaks, levels that were last seen during previous periods of overheated sentiment, such as mid-2021 and pre-2018, as per the analysis done by domestic brokerage firm InCred Equities. In contrast, the Nifty 50 is trading at a more reasonable 20.7x forward P/E. The narrowing gap between small- and mid-cap valuations is causing discomfort among investors, particularly in an environment of persistent global uncertainties and uneven earnings visibility. Without a strong pickup in earnings growth, such elevated valuations leave little room for upside and increase the risk of a valuation-driven correction. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
India Today
4 days ago
- Business
- India Today
Explained: Why Dalal Street hasn't panicked amid ongoing Iran–Israel conflict
The Iran–Israel conflict rattled global markets last week, briefly dragging down Indian equities. But the panic was short-lived. On Monday, the Nifty and Sensex rebounded sharply, reflecting the Street's growing comfort with geopolitical uncertainty, and its continued focus on domestic markets did slip in the immediate aftermath of the conflict, investors quickly shifted back to buying, taking cues from stabilising oil prices and strong domestic the escalation of the Iran–Israel conflict, globally stock markets are steady and resilient," said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services. "The decline in the US volatility index CBOE suggests that markets are unlikely to correct sharply unless the conflict takes a dramatic turn for the worse." The early days of the flare-up did trigger a risk-off mood as oil prices spiked and equities slid. But with no disruption to energy supplies or trade flows through critical chokepoints like the Strait of Hormuz, those fears quickly eased.'Global markets often behave contrary to mainstream expectations, and the recent escalation between Israel and Iran is a textbook example,' said Harshal Dasani, Business Head at INVasset PMS. 'While the initial reaction was a spike in oil prices and a flight to safety, the absence of direct supply disruptions... quickly settled nerves.'advertisement'As clarity emerged and worst-case scenarios were ruled out, markets bounced back,' he added. 'Investors are again viewing dips as opportunities, with capital rotating into domestic themes that are largely insulated from global geopolitical shocks.'RETAIL INVESTORS BUY THE DIPBack home, domestic liquidity once again cushioned the fall. Over four sessions of FII selling worth Rs 8,080 crore, DIIs stepped in with a far stronger Rs 19,800 crore in net buying, fuelled by steady retail flows.'The main contributor to the market resilience is the retail investors using every dip in the market as a buying opportunity,' said Vijayakumar. 'Valuations do not appear to deter retail investors. Sustained retail funds flows, mainly through SIPs, are empowering the DIIs to buy consistently.'Even as war headlines dominated, Indian markets stayed grounded in local drivers. 'We're seeing renewed strength in internal consumption-driven sectors—especially energy, power, defence, and capital expenditure-linked plays,' Dasani said. These themes, he added, 'benefit from long-term policy support, strong demand visibility, and minimal dependence on external macro conditions.'Vinod Nair, Head of Research at Geojit, said large-cap stocks led Monday's recovery. 'Despite ongoing geopolitical tensions between Israel and Iran, the market moved higher, supported by gains in large-cap stocks, as investors maintained their focus on long-term fundamentals,' he said. However, he flagged that small-cap stocks may underperform in the near term due to high valuations and lack of short-term and gas stocks were among the biggest gainers, thanks to crude stabilisation. IT stocks also rallied, ahead of the US Fed's rate guidance this REMAINSWhile markets may have shrugged off the worst-case scenarios, the risk hasn't entirely vanished. As Dasani pointed out, 'Every fresh negative headline may cause temporary jitters, but the broader trend remains bullish. As long as geopolitical risks remain contained and don't evolve into systemic shocks, markets will continue to absorb such events.'Vijayakumar also offered a word of caution: 'Even while exercising some caution, it makes sense to remain invested in this market and to buy the dips.' With the Nifty finding support around 24,500 and facing resistance near 25,000, traders and investors alike are watching the next global trigger but staying the course.(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)Must Watch
