Indian equity markets opened lower on Monday as escalating tensions between the United States and Iran weighed on investor sentiment. The NSE Nifty slipped to around the 24,000 level in early trade, while the BSE Sensex traded at 76,965, down 614 points.
Geopolitical tensions in West Asia prompted investors to reduce exposure to risk assets, resulting in a weaker opening for Indian equities. The primary drivers of the decline were a sharp rise in crude oil prices and global economic uncertainty. Concerns over energy supply affected market sentiment, although selective buying was seen in information technology and energy stocks.
Rising tensions between the United States and Iran increased volatility across global financial markets. Concerns over uncertainty surrounding key maritime energy supply routes led to higher international crude oil prices. Elevated oil prices remain a concern for major importing countries such as India, as they may increase inflationary pressures, the import bill and corporate costs. As a result, investors adopted a cautious approach on the first trading session of the week.
Broad-based selling was witnessed immediately after the market opened. The Sensex traded around 76,965, down approximately 614 points in early trade, while the Nifty 50 approached the key psychological level of 24,000. According to analysts, global developments, crude oil prices and foreign investor activity are expected to play an important role in determining the direction of Indian markets in the near term.
While most sectors remained under pressure, the information technology sector outperformed the broader market. The Nifty IT Index traded about 0.62% higher in early trade. IT companies are generally considered relatively defensive during such periods because of their global revenue base and dollar-denominated earnings, leading investors to continue buying in the sector.
The impact of higher crude oil prices on energy stocks was mixed. Shares of oil marketing companies (OMCs) remained under pressure as elevated crude prices could affect their margins. In contrast, oil and gas production companies, particularly ONGC, registered gains as higher crude oil prices are generally considered favourable for upstream producers.
The Nifty 50 advance-decline ratio stood at 12:38 in early trade, indicating broad-based selling across the market. TCS, HCL Technologies, ONGC, Apollo Hospitals and Tech Mahindra were among the leading gainers. InterGlobe Aviation (IndiGo), Tata Steel, Shriram Finance, Asian Paints and Bajaj Finance were among the major losers.
The market performance reflected investor preference for defensive and export-oriented sectors, while cyclical and consumer-focused sectors witnessed profit booking.
Several stocks remained in focus during the trading session following corporate announcements and business updates. These included LTM, Avenue Supermarts (DMart), Adani Green Energy, Keystone Realtors, Mankind Pharma, Lux Industries, RITES, JSW Energy, NTPC, NMDC, Sterlite Technologies, Power Grid Corporation of India and Swiggy. Investors continued to monitor quarterly earnings, new investments, order books, expansion plans and other business announcements by these companies.
NMDC announced revised iron ore prices effective from July 10, including updated prices for both Baila Lump and Baila Fines. The decision may affect companies in the steel and mining sectors.
Lux Industries laid the foundation stone for a new manufacturing facility at Dankuni in West Bengal with an investment of approximately ₹600 crore. The company aims to develop the project into one of Asia's major garment manufacturing hubs, with expectations of increasing production capacity and employment in the future.
