Indian stock markets witnessed a steep fall on Friday, with benchmark indices tumbling for a second straight session. The downturn followed fresh geopolitical concerns after a deadly terrorist attack in Kashmir, which raised fears of rising tensions between India and Pakistan.
By 10:33 AM, the BSE Sensex had dropped 981 points, or 1.23%, to 78,819, while the NSE Nifty50 slipped 301 points, or 1.24%, to 23,948. This sharp drop came after both indices touched fresh intraday highs earlier in the session, with the Sensex briefly crossing the 80,000 mark and Nifty reaching beyond 24,350.
Investor wealth sees massive erosion
The overall market capitalisation of all companies listed on the BSE fell sharply by ₹8.5 lakh crore, bringing it down to ₹421.13 lakh crore. The slump was attributed to broad-based profit booking amid increased geopolitical risks.
“Markets have had a remarkable run, moving from a level of 22,000 to above 24,400 on the Nifty. After such a strong rally, a phase of profit booking was expected,” said Kranthi Bathini, Director – Equity Strategy at WealthMills Securities Pvt Ltd. “Now, with heightened geopolitical risks, many investors are opting to book profits and shift to cash positions,” he added.
TCS, Infosys, IndusInd among few gainers
Despite the overall decline, a few stocks managed to stay in positive territory. TCS led with a 0.70% gain, followed by Infosys (0.67%) and IndusInd Bank (0.31%). HDFC Bank saw a minor rise of 0.08%, while ICICI Bank remained flat.
In contrast, Axis Bank recorded the steepest drop, falling by 4.28%. Other significant losers included Adani Ports (down 3.38%), Bajaj Finance (–2.61%), Bajaj Finserv (–2.49%), and Power Grid (–2.40%).
Broader markets and volatility reflect investor anxiety
Mid and small-cap stocks bore the brunt of Friday’s sell-off. The Nifty Midcap 100 index fell 2.85%, while the Smallcap 100 index plunged 3.30%. Market volatility surged, with the India VIX rising 6.46%, reflecting growing investor unease.
All major sectoral indices ended in the red. Nifty Media led the sectoral losses with a 3.54% drop, followed by Nifty PSU Bank (–2.87%) and Realty (–2.69%). Pharma and Healthcare sectors each declined over 2.4%. Other losers included Nifty Metal (–2.42%), Consumer Durables (–2.08%), Oil & Gas (–1.97%), and Auto (–1.88%). Even defensive sectors like FMCG, Financial Services, and IT faced pressure, with the Nifty IT index falling by 0.45%.
Geopolitical concerns weigh heavily
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, pointed to rising uncertainty over India’s response to the Kashmir terror attack as a key concern. “The market is clearly on edge, waiting for clarity on the geopolitical front,” he said.
Kranthi Bathini echoed a cautious outlook. “Due to the global uncertainty and escalating Indo-Pak tensions, investors should consider staying in cash unless they have a long-term investment horizon. Buying on dips may still be a viable strategy for those with patience,” he noted.
Global cues remain mixed but optimistic
Asian markets traded mostly higher, with optimism surrounding the White House’s softened stance on China. Hong Kong’s Hang Seng Index gained 0.9%, while China’s Shanghai Composite and CSI300 also posted modest gains. The positive sentiment followed strong earnings from Google parent Alphabet, whose stock surged nearly 5% in after-hours trading, boosting U.S. tech peers and lifting S&P 500 futures by 0.5%.
The S&P 500 closed Thursday’s session with a solid 2% gain, supported by tech-led momentum.
Foreign investors continue buying spree
Despite domestic concerns, foreign portfolio investors (FPIs) remained net buyers in Indian equities for the seventh consecutive session. On Thursday, FPIs invested ₹8,251 crore (around $968 million), showing continued confidence in India’s long-term growth story.
Crude oil prices inch up but head for weekly losses
In global commodities, crude oil prices edged higher in early Friday trade but were poised for weekly declines. Brent crude rose 5 cents to $66.60 per barrel, while U.S. WTI crude added 6 cents to reach $62.85. Analysts cited ongoing talks about an OPEC+ output hike and a potential ceasefire in the Russia-Ukraine conflict as weighing on demand expectations.
Rupee gains against the dollar
The Indian rupee strengthened by 18 paise, trading at 85.15 against the U.S. dollar in early deals. Meanwhile, the dollar index climbed 0.47% to 99.84, signaling a renewed upward momentum in the greenback against major global currencies.
