📉 Market Wrap: Sensex Drops 212 pts, Nifty Slips Below 25,900 Amid Geopolitical Tensions
Indian equity markets ended in the red on Monday, as global headwinds and geopolitical instability weighed heavily on investor sentiment. The BSE Sensex declined by 212 points, closing at 81,583, while the NSE Nifty dipped 93 points, finishing below the psychological 25,900 level at 25,853.
🌍 Geopolitical Tensions & Global Headwinds
The broader market sentiment was dampened by escalating tensions in the Middle East, particularly between Israel and Iran. Investor nerves were rattled after U.S. President Donald Trump ruled out a ceasefire, indicating that the conflict may drag on. This spurred a sell-off across global equities, including Asian, European, and U.S. markets.
Adding to the pressure were:
- Brent crude prices rising above $74 per barrel
- Continued FII outflows, signaling lack of foreign investor confidence
- Uncertainty around the U.S. Federal Reserve’s rate decision expected on June 18
🔻 Sectoral Impact: Pharma, Metals & Autos Underperform
Profit-booking dominated across the board, with mid- and small-cap stocks taking a heavier beating. The Nifty 500 advance-decline ratio stood at a weak 1:3, reflecting broad-based market weakness.
Key sectoral losers included:
- Pharma: Down 2%, after a Bloomberg report indicated Trump’s intention to impose new tariffs on pharmaceutical companies. Stocks like Lupin, Granules India, Natco Pharma, and Aurobindo Pharma lost more than 3% each.
- Metals, Auto, Real Estate, Oil & Gas, and Banking: All declined between 0.5% to 1%.
On the brighter side, Nifty IT and Nifty Defence indices bucked the trend, each gaining about 0.5%, driven by defensive buying and relative strength in the sector.
📊 Technical Outlook: Crucial Support at 24,800
The Nifty index opened higher but witnessed a sharp sell-off early in the session. After initial weakness, it consolidated in a narrow range and closed just above 24,850, down nearly 90 points.
Technical Highlights:
- A bearish candle was formed on the daily chart.
- The index has been making higher highs and higher lows over the past two sessions.
- Key support levels are seen at 24,700 and 24,600.
- On the upside, sustained move above 25,000 is crucial for momentum to resume towards 25,250 and 25,500 levels.
🔍 What Should Investors Do?
With volatility expected to continue due to geopolitical risks, crude fluctuations, and macroeconomic data, traders are advised to:
- Remain cautious with leveraged positions
- Monitor 24,800 as a key support level
- Watch for directional cues post the U.S. Fed decision on June 18
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For full research disclosures, refer to: Motilal Oswal Research Disclosure