The Indian stock market faced a setback today, with both the Sensex and Nifty ending the session in the negative territory. As geopolitical tensions between India and Pakistan rose, investors appeared to exercise caution, leading to a dip in market sentiment in the late trading hours.
Both the Sensex and Nifty ended the day on a downbeat note. The Nifty closed at 24,273.80, a decline of 0.58%, while the Sensex settled at 80,334.81, down by 0.51%. The India VIX, a gauge of market anxiety, saw an uptick and ended the session up at 10.21%.
Geopolitical tensions cast a shadow over the market
The market’s cautious tone can largely be attributed to escalating tensions between India and Pakistan. Reports indicated that Pakistan’s air defence systems in Sialkot and Lahore were damaged, sparking concerns over possible further escalations.
In response to the rising tensions, Pakistan ramped up ceasefire violations along the Line of Control (LoC), with reports of heavy artillery exchanges in several regions. These developments have heightened fears of further hostilities in the region, which in turn dampened investor sentiment and contributed to today’s market decline.
“There is a lot of caution in the markets as investors are worried that the ongoing tension resulting in a major conflict between the two nuclear-powered nations going ahead could spark a major sell-off in equities, and hence profit-taking was seen in almost all the sectors barring select IT counters. With the local currency depreciating sharply amid the ongoing stand-off, foreign investors could flee domestic equities to park their funds in overseas safe-haven assets,” said Prashanth Tapse, Senior VP (Research), Mehta Equities.
Pakistan stocks plunge amid drone attack reports
The Pakistan Stock Exchange faced a dramatic sell-off on Thursday, forcing a one-hour trading halt after the benchmark index crashed 7.2% during the session. The market, which had opened in the green during early trade, quickly reversed course as reports emerged of drones being shot down over major cities like Karachi and Lahore.
Let’s take a look at the key highlights of today’s trading session-
Broader market performance
The BSE midcap index also suffered, shedding 1.9%, while the smallcap index saw a smaller but still notable dip of 1%.
The broader market bore the brunt, with both midcap and smallcap indices ending sharply lower. The BSE Midcap index closed the day at 42,154.47, slipping over 800 points, while the BSE Smallcap index ended at 46,882.73, down by nearly 500 points.
In the smallcap space, the biggest losers of the day included Avalon (-7.57%), Renaissance Global (-7.14%), CCL Products (-7.08%), Ravindra Energy (-6.63%), and Bajel Project (-6.46%). On the midcap index, key underperformers were UPL, Torrent Power (-5.48%), Jubilant FoodWorks (-5.36%), Godrej Properties (-4.75%), and Paytm (-4.53%).
Sectoral woes drag market lower
Except the IT sectors stocks and Media sectors, the majority of sectors faced significant losses. The metal, oil & gas, pharma, PSU Bank, auto, consumer durables, and realty sectors were among the hardest hit, each slipping by 1-2% during today’s session.
Stock movers: Top gainers and laggards
Top Gainers
Despite the overall market decline, some stocks managed to stand out. Among the top performers in the Sensex 30 were HCL Tech, Axis Bank, Kotak Bank, and Titan, which all saw gains during today’s session.
Key Laggards
On the flip side, some heavyweights in the market faced a tough day. Stocks such as Eicher Motors, M&M, Maruti, Tata Steel, and Asian Paints emerged as the key laggards, contributing to the overall downward movement in the market.
Rupee takes a hit
Adding to the market’s woes, the Indian rupee faced its sharpest drop since February 2022, falling 1.1% to 85.79 per dollar.