Mumbai, March 27 The benchmark indices Sensex and Nifty fell by over 2% on Friday, following a two-day rally, in line with a weak trend in global peers, as the US-Iran conflict remained the key factor weighing on markets, raising doubts about a de-escalation of the war.
The persistently high crude oil prices above USD 100 per barrel, the sharp fall in the rupee, and continued outflows of foreign funds further contributed to the negative sentiment.
The 30-share BSE Sensex plunged by 1,690.23 points, or 2.25%, to close at 73,583.22. During the day, it dropped by 1,739.04 points, or 2.31%, to 73,534.41.
The 50-share NSE Nifty declined by 486.85 points, or 2.09%, to end at 22,819.60.
Among the 30 Sensex companies, Reliance Industries saw the largest fall, at 4.55%, followed by InterGlobe Aviation, Bajaj Finance, State Bank of India, Eternal, and HDFC Bank.
In contrast, Tata Consultancy Services, Bharti Airtel, and Power Grid saw gains.
Brent crude, the global benchmark for oil, rose by 1.72% to USD 109.9 per barrel.
The rupee fell by 86 paise to close at another all-time low of 94.82 (provisional) against the US dollar on Friday.
In Asian markets, South Korea's benchmark Kospi and Japan's Nikkei 225 index ended lower, while Shanghai's SSE Composite index and Hong Kong's Hang Seng index ended in positive territory.
European markets were trading in the red.
The US market ended sharply lower on Thursday.
"Profit booking started after the recent two-day rally as the rupee fell to an all-time low amid sustained selling by foreign investors, while escalating tensions in the Middle East heightened caution among investors ahead of the weekend," Vinod Nair, Head of Research, Geojit Investments Limited, said.
Stock markets were closed on Thursday due to Ram Navami.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,805.37 crore on Wednesday, according to exchange data. Domestic Institutional Investors (DIIs), however, bought stocks worth Rs 5,429.78 crore.
"Indian markets witnessed a sharp and volatile session, with heavyweight energy stocks leading the decline amid a complex mix of policy changes, rising crude prices, and persistent geopolitical uncertainty.
"Adding to the pressure, the Indian rupee weakened further to record lows against the US dollar, underscoring the underlying macroeconomic stress," Hariprasad K, Research Analyst and Founder, Livelong Wealth, said.
On Wednesday, the Sensex jumped 1,205 points or 1.63% to close at 75,273.45. The Nifty surged 394.05 points or 1.72% to end at 23,306.45.