Indian benchmark indices dip nearly 6 pc this week over Middle East tensions
Mumbai, March 14
Indian equity benchmarks lost nearly 6 per cent on a weekly basis, reflecting sustained selling pressure amid escalating geopolitical tensions in West Asia.
Nifty dipped 5.31 per cent during the week and lost 2.06 per cent on the last trading day to reach 23,151. At close, Sensex was down 1,470 points or 1.93 per cent at 74,563. It advanced 5.52 per cent during the week.
The sharp correction has largely been driven by the surge in crude oil prices and rising macroeconomic concerns for energy-importing economies like India.
The Nifty Auto index plunged around 10-11 per cent, marking its worst weekly performance since March 2020, with each stock in the index seeing a strong sell off.
Shortages of LNG and LPG raise the risk of production disruptions, while potential constraints in CNG availability could alter consumer demand patterns, especially in urban markets where CNG vehicles have gained traction.
Sector-wise, banking, metal, and auto stocks were among the biggest drags on the last trading day of the week.
The sharp decline wiped out nearly Rs 9.5 lakh crore in investor wealth in a single session.
Broader indices performed in line with the benchmark indices during the week, as the Nifty Midcap100 declined 4.59 per cent, while Nifty Smallcap100 dipped 3.66 per cent.
Higher crude prices not only elevate inflation risks but also contribute to currency weakness, with the Indian rupee coming under pressure, further dampening investor sentiment, analysts said.
The Indian rupee weakened for the second consecutive week, settling at a fresh record low of 92.45 against the US dollar.
Analysts said that immediate support for Nifty is seen at 23,000 and immediate resistance is placed at 23,300 and 23,500 levels.
For Bank Nifty, 53,500 stands as the immediate support level, followed by 53,000, market participants said. On the upside, 54,000 acts as the immediate resistance, followed by 54,300 levels.
India VIX climbed above the 22 level, signalling heightened fear among market participants and expectations of wider price swings in the near term, analysts said.
— IANS
Reader Comments
Just checked my portfolio... down by 8% this week! 😓 It's painful to see hard-earned savings evaporate because of conflicts happening thousands of miles away. Hoping RBI has some measures to stabilize the rupee. Time to hold tight and not panic sell.
The VIX above 22 says it all – fear is in the air. But seasoned investors know this is also a time for opportunity. If you have liquidity, some quality stocks are on sale. Support at 23,000 for Nifty looks strong. Let's see if it holds on Monday.
Working in the auto component sector in Chennai. The talk of CNG shortages is very real on the ground. If fuel supply gets hit, production lines will stall. This isn't just about stock prices; it's about real economic impact and people's livelihoods.
While the geopolitical situation is beyond our control, I respectfully think our market regulators could be more proactive in calming retail investor nerves. Communication during such volatile times is key to prevent a herd mentality sell-off.
Rs 9.5 lakh crore gone in a session! That number is staggering. It affects pension funds, insurance, mutual funds – everything. The common man suffers the most. Hope the tensions de-escalate soon for everyone's sake, not just the markets.
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