Mumbai, March 4 The benchmark equity indices, Sensex and Nifty, plunged in early trading on Wednesday, mirroring a bearish trend in Asian markets, as the conflict in West Asia intensified, driving up oil prices.
The 30-share BSE Sensex fell by 1,758.22 points or 2.19%, closing at 78,480.63, as the conflict continued to negatively impact investor sentiment. The 50-share NSE Nifty declined by 530.85 points or 2.13%, closing at 24,334.85.
Among the Sensex stocks, Larsen & Toubro, Tata Steel, InterGlobe Aviation, UltraTech Cement, Adani Ports, and Mahindra & Mahindra were among the worst performers.
Infosys, HCL Tech, and Tata Consultancy Services were the gainers.
Brent crude, the global benchmark for oil, rose by 0.87% to $82.11 per barrel.
Asian markets were trading sharply lower. South Korea's Kospi fell by over 10%. Japan's Nikkei 225, China's SSE Composite index, and Hong Kong's Hang Seng index were also quoting significantly lower.
The US market ended in negative territory on Tuesday.
The conflict in West Asia intensified as Iran continued to attack several Gulf countries in retaliation for the joint attack by Israel and the US. The US and Israel have also launched fresh strikes on Iran.
"With the war escalating and crude oil prices rising, markets are entering a period of heightened uncertainty. No one knows how long this conflict will last and what extent of damage it could cause. From India's perspective, which relies on imports for around 85% of its oil requirements, the real concern is the potential for inflation and its impact on economic growth," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.
From a market perspective, the real issue is the potential for a widening trade deficit, a depreciating currency, higher inflation, and potentially slower growth, he added.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,295.64 crore on Monday, according to exchange data. Domestic Institutional Investors (DIIs), however, bought stocks worth Rs 8,593.87 crore.
Equity markets were closed on Tuesday for Holi.
On Monday, the Sensex closed at 80,238.85, down 1,048.34 points or 1.29%. The Nifty settled 312.95 points or 1.24% down at 24,865.70.
