Mumbai: Indian equity markets witnessed a sharp sell-off on Thursday morning, with benchmark indices plunging after fresh remarks by US President Donald Trump on the escalating Iran conflict rattled global investor sentiment.
The S&P BSE Sensex tumbled 1,401.01 points to 71,733.32, while the NSE Nifty50 dropped 439.55 points to 22,239.85 in early trade, reflecting widespread nervousness across sectors.
Trump’s remarks trigger global jitters
Investor sentiment turned negative after Donald Trump warned of strong military action against Iran, including potential strikes on critical oil infrastructure. His remarks hinted at a possible escalation in the conflict over the next few weeks.
“We’re going to hit them extremely hard. Over the next two to three weeks, we’re going to bring them back to the Stone Age,” Trump said, adding that Iranian oil facilities remain a possible target if tensions intensify.
At the same time, he noted that diplomatic channels are still open, with discussions ongoing as the US evaluates its next course of action. However, markets reacted sharply to the possibility of military escalation, especially given West Asia’s importance in global energy supply.
Crude oil spike adds to pressure
The geopolitical uncertainty led to a spike in global crude oil prices, further weighing on market sentiment. Brent crude surged nearly 5 per cent to touch around $105 per barrel, raising concerns over inflation and India’s import bill.
According to Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, the combination of rising crude prices and geopolitical risks has created a negative backdrop for equities.
He noted that the US 10-year bond yield also firmed up to 4.36 per cent, adding to global financial market pressures. Precious metals like gold and silver saw marginal impact amid the volatility.
Broad-based selling across sectors
The market decline was broad-based, with most sectoral indices trading in the red during early hours.
Among key stocks, Sun Pharmaceutical Industries Ltd recorded the steepest fall, plunging 4.52 per cent. InterGlobe Aviation Ltd (IndiGo) declined 3.93 per cent, while Adani Ports and Special Economic Zone Ltd dropped 3.52 per cent. NTPC Ltd slipped 3.19 per cent, and Eternal Ltd fell 3.13 per cent.
HCL Technologies Ltd was the only notable gainer in early trade, edging up marginally by 0.08 per cent.
The widespread losses indicate a risk-off sentiment among investors, with capital moving away from equities amid global uncertainty.
FPI selling and rupee pressure persist
Foreign portfolio investors (FPIs) continued their selling spree, adding further pressure to Indian markets. Data showed that FPIs sold equities worth Rs 8,331 crore on April 1 alone.
Vijayakumar highlighted that multiple factors — including high crude prices, a widening trade deficit, concerns over remittances, and sustained FPI outflows — are cumulatively weighing on the Indian rupee.
Despite measures taken by the Reserve Bank of India to stabilise currency markets, the rupee has remained under pressure in recent sessions.
Mixed outlook amid uncertainty
While the broader market sentiment remains weak, some pockets of resilience are visible. Vijayakumar pointed out that strong March auto sales numbers indicate underlying strength in the automobile sector, which may help auto stocks outperform in the near term.
He also cautioned against taking Trump’s timeline for military action at face value, noting the US President’s history of shifting positions on geopolitical matters.
Investors advised to stay cautious
Market experts advise investors to remain cautious amid heightened volatility and geopolitical uncertainty. The evolving situation in West Asia, coupled with rising crude prices and global financial tightening, is expected to keep markets on edge in the near term.
As developments unfold, investor focus will remain on geopolitical signals, crude oil trends, and foreign investment flows, all of which will play a crucial role in shaping market direction.