Sensex slumps 1,100 pts today; Nifty logs worst week in 1-yr; key triggers

Market crash today: The volatility gauge, India VIX, has risen 45 per cent this week, the highest since April last year, taking the yearly surge to nearly 110 per cent

Indian equity markets extended their losses on Friday, with the benchmarks recording their worst weekly run in over a year, as rising geopolitical tensions continued to weigh on investor sentiment.

 

The Nifty50 index fell as much as 1.41 per cent, or 350 points, to 24,415.7, while the 30-stock Sensex index slumped 1.4 per cent or 1,141 points, to 78,864.6 on Friday. The Nifty and Sensex fell over 2.8 per cent so far this week, their worst run since the week ending February 27 last year. 

 

The volatility gauge, India VIX, has risen 45 per cent this week, the highest since April last year, taking the yearly surge to nearly 110 per cent. 

 

On the sectoral front, Most indices were in the red, with Nifty Private Bank and Realty down over 2 per cent. Nifty PSU Bank, Auto, Consumer Durables and Media were also among the top losers on Friday. In the broader market, the Nifty Midcap 100 and Nifty Smallcap 100 indices were down 0.69 per cent and 0.24 per cent, respectively. 

 

Global risks continue to stress-test the Nifty 50 index's trading band of 24,000-26,000, which indicates underlying strength, according to InCred Equities. With a healthy results season, the forward price-to-earnings valuation has eased below the 10-year mean level. The brokerage has retained its Nifty 50 target of 28,433 for December 2026, implying about a 15 per cent upside from current levels. 

Why are Indian stock markets falling?

West Asia jitters: Investor sentiments continued to be in a risk-off mood as the US and Israel fired missiles across Iran last week, with the Supreme Leader Ayatollah Ali Khamenei being killed. Iran responded with strikes against Israel, as well as US bases and other targets in states including Saudi Arabia, Qatar, the United Arab Emirates (UAE), Kuwait and Bahrain. 

 

As the conflict entered its sixth day, US President Donald Trump said he wants to replace Iran’s leadership structure. Meanwhile, Bloomberg reported that shipping through the Strait of Hormuz has nearly come to a halt as the war in Iran continues. Further, Brent crude oil is currently trading above $85 a barrel and is headed for the biggest weekly surge since 2022, as per the news agency.

 

Persistent geopolitical tensions in the West continued to dampen investor sentiment while keeping global energy prices elevated, analysts said. At the same time, steady domestic institutional investor (DII) inflows are helping cushion the market against continued selling by foreign portfolio investors (FPIs), according to Ponmudi R, chief executive officer at Enrich Money. 

 

Global markets mixed: US stocks fell on Thursday and indicated a weaker start on Friday amid modest moves in oil prices after a fresh wave of military strikes across West Asia. Futures for the S&P 500 were down 0.2 per cent. Meanwhile, Asian markets edged higher, with Japan’s Nikkei rising 0.63 per cent and South Korea’s Kospi gaining 0.02 per cent.    ==========  (Disclaimer: The views and investment tips expressed by the analysts in this article are their own and not those of the website or its management. Business Standard advises users to check with certified experts before taking any investment decisions.)