Midday Update: Sensex Falls Over 490 Points, Nifty 50 Slips Below 23,500 Amid Iran Tensions and Rising Brent Crude Above $110

Market Update at 12:19 PM: Indian equity benchmarks recovered partially from the day’s low during afternoon trade on Monday, supported by gains in information technology stocks. However, broader market sentiment remained weak amid escalating geopolitical tensions involving Iran and rising crude oil prices.

As of 12 PM, the Nifty 50 was down 154.85 points, or 0.65 per cent, at 23,476.95. The Sensex declined 496.96 points, or 0.66 per cent, to 74,722.81.

Among the Top Losers on the Nifty 50 index were Power Grid Corporation of India, Tata Steel, and Titan Company. Selling pressure was visible across several sectors, particularly consumer durables, realty, PSU Banks, and media stocks.

The broader markets also remained under pressure. The Nifty MidCap index traded 0.92 per cent lower, while the Nifty SmallCap index fell 1.66 per cent, indicating weakness beyond frontline indices.

Sectorally, the Nifty Consumer Durables, Nifty Realty, Nifty PSU Bank, and Nifty Media indices underperformed the benchmark indices. On the other hand, the Nifty IT index emerged as the top sectoral gainer, helping markets recover from Intraday lows.

Investor sentiment remained cautious after U.S. President Donald Trump warned Iran in a social media post, stating that time was “ticking fast” for Tehran and suggesting severe consequences if a decision was not made soon. The remarks added to concerns over geopolitical instability in the Middle East.

Meanwhile, Brent crude oil prices continued to surge amid fears of supply disruptions. Brent crude’s May futures contract was trading 1.51 per cent higher at USD 110.91 per barrel on the Intercontinental Exchange.

Market Update at 09:35 AM: Indian equity benchmarks opened sharply lower on Monday as rising geopolitical tensions between the U.S. and Iran triggered a spike in crude oil prices, weighing heavily on investor sentiment. Weak global cues and concerns over inflationary pressure from higher energy prices added to the market selloff.

At 9:17 AM, the Nifty 50 was trading 258.55 points, or 1.09 per cent, lower at 23,382.60. The Sensex declined 855.87 points, or 1.14 per cent, to 74,382.12.

Among the top laggards on the Nifty 50 were Power Grid Corporation, Tata Steel, and Titan Company, as broad-based selling pressure hit metal, infrastructure, and consumer stocks.

The weakness extended to the broader market as well. The Nifty MidCap index slipped 1.04 per cent, while the Nifty SmallCap index fell 1.15 per cent, indicating risk-off sentiment among investors.

On the sectoral front, the Nifty Realty, Nifty Auto, and Nifty Media indices underperformed amid concerns that rising fuel costs could impact demand and profitability. However, the Nifty IT index showed relative resilience and outperformed the broader market.

Investor sentiment turned cautious after U.S. President Donald Trump said in a social media post that time was “ticking fast” for Iran. He warned that if Tehran failed to make a decision soon, “nothing will be left,” escalating fears of a deeper geopolitical conflict in the Middle East.

Crude oil prices surged following the remarks. Brent crude’s May futures contract rose 1.78 per cent to USD 111.13 per barrel on the Intercontinental Exchange, intensifying concerns over global inflation and higher import costs for oil-dependent economies such as India.

Meanwhile, precious metals traded lower in early trade. Gold futures declined 0.56 per cent, while silver futures dropped 2.61 per cent.

Pre-Market Update at 7:48 AM: The Indian stock market is likely to open on a cautious note on Monday, May 18, as rising geopolitical tensions in the Middle East and higher crude oil prices continue to weigh on global investor sentiment. Trends in Gift Nifty indicate a weak start for benchmark indices BSE Sensex and Nifty 50 after a volatile end to last week.

Gift Nifty was trading near the 23,521 mark, down more than 186 points from the previous close of Nifty futures, indicating potential pressure on domestic equities at the opening bell.

Asian markets traded lower, while Wall Street ended sharply weaker on Friday as rising crude oil prices and higher bond yields sparked concerns over inflation and global economic stability.

Investor sentiment remained fragile after tensions between the U.S. and Iran escalated further over the weekend. A drone strike near the Barakah Nuclear Energy Plant in the United Arab Emirates triggered fresh geopolitical concerns despite no radiation leak or casualties being reported.

The UAE Defence Ministry confirmed that two drones were intercepted, while another drone struck near the facility. The International Atomic Energy Agency stated that one reactor briefly switched to emergency diesel generators following the incident.

Meanwhile, U.S. President Donald Trump intensified his rhetoric against Iran, warning that “the clock is ticking” and urging Tehran to move quickly in ongoing negotiations. The developments have raised concerns over potential disruptions in the Strait of Hormuz, a critical global oil supply route.

In a positive development for global trade, the U.S. and China agreed to establish new trade and investment mechanisms during Trump’s visit to Beijing. According to a White House fact sheet, both nations will work towards a more stable and reciprocal economic relationship.

However, the positive sentiment from the talks was overshadowed by rising geopolitical uncertainty and concerns over inflationary pressures from higher energy prices.

Crude oil prices surged sharply amid fears of supply disruptions linked to the U.S.-Iran conflict.

Brent crude climbed 2.33 per cent to USD 111.81 per barrel, while U.S. West Texas Intermediate (WTI) crude futures gained 2.79 per cent to USD 108.36 per barrel.

The sharp rise in oil prices has increased concerns over inflation, especially for emerging markets like India that heavily depend on crude imports.

Global bond yields also moved sharply higher, reflecting inflation worries.

The benchmark U.S. 10-year Treasury yield stood at 4.607 per cent, while the two-year Treasury yield was at 4.085 per cent.

Japanese government bond yields also surged, with the 10-year JGB yield touching 2.775 per cent, its highest level since October 1996. The 20-year yield climbed to 3.735 per cent.

The U.S. dollar strengthened against major global currencies. The dollar index edged higher to 99.393, adding pressure on emerging market currencies including the Indian rupee.

From the derivatives segment, the Put-Call Ratio (PCR) stood at 0.94, indicating a cautious undertone in the market.

On the Put side, major open interest was concentrated at the 23,000 and 23,500 strikes, suggesting strong support zones.

On the Call side, significant open interest addition was seen at the 24,000 and 24,500 strikes, indicating that the 24,000 level may act as immediate resistance for Nifty 50.

Technically, Nifty 50 is expected to find immediate support in the 23,450–23,550 range. The crucial downside support remains near last week’s low of 23,262.

A break below this level could intensify selling pressure and drag the index towards the April 8 gap support near 23,153.

On the upside, the 23,830–23,860 zone remains a key resistance area. A sustained move above this range could revive bullish momentum towards the 24,000–24,070 region, where the 20-day moving average is placed.

Several companies are scheduled to announce quarterly earnings on May 18, including Indian Oil Corporation, Afcons Infrastructure, Ola Electric Mobility, Apollo Micro Systems, Astral, DOMS Industries, Indraprastha Gas, Puravankara, and Zydus Wellness.

For Monday, Steel Authority of India and Kaynes Technology India are under the F&O ban list.

On May 15, Foreign Institutional Investors (FIIs) bought Indian equities worth Rs 1,329.17 crore. Domestic Institutional Investors (DIIs), however, remained net sellers and offloaded shares worth Rs 1,958.82 crore.

Benchmark indices snapped a two-day winning streak on Friday amid profit booking, weak global cues, rising crude oil prices, and a sharp fall in the rupee.

The Sensex declined 161 points, or 0.21 per cent, to close at 75,237.99, while Nifty 50 slipped 46 points, or 0.19 per cent, to settle at 23,643.50.

U.S. stock markets closed sharply lower on Friday as investors reacted to rising crude oil prices and higher Treasury yields.

The Dow Jones Industrial Average fell 537.29 points, or 1.07 per cent, to 49,526.17. The S&P 500 dropped 1.24 per cent to 7,408.50, while the Nasdaq Composite declined 1.54 per cent to 26,225.15.

Energy stocks emerged as the only gainers among the S&P 500 sectors, while Semiconductor shares dragged markets lower. The Philadelphia SE Semiconductor Index plunged 4 per cent.

Gold prices remained largely steady in early Asian trade as investors assessed the possibility of further interest rate hikes by the U.S. Federal Reserve.

Spot gold traded flat at USD 4,539.13 per ounce.

Disclaimer: The article is for informational purposes only and not investment advice.

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