Bourses sink 1% amid selloff in oil & gas stocks on rising tensions in Middle East

Mumbai: Benchmark Sensex tanked 823 points on Thursday following a selloff in oil & gas, power and capital goods shares in tandem with weak global market trends amid growing tensions in the Middle East.

The 30-share BSE Sensex dropped 823.16 points or 1 per cent to settle at 81,691.98 with 27 of its constituents declining and three ending higher.

During the day, it plunged 991.98 points or 1.20 per cent to 81,523.16.

Snapping its six-day winning streak, the broader NSE Nifty tumbled 253.20 points or 1.01 per cent to 24,888.20.

Fresh foreign fund outflows also dented investors’ sentiment, traders said.

Among Sensex stocks, Tata Motors, Titan, Eternal, Power Grid, Tata Steel, Larsen & Toubro, Mahindra & Mahindra and Hindustan Unilever were among the biggest laggards.

Bajaj Finserv, Asian Paints and Tech Mahindra were the gainers.

The market capitalisation of BSE-listed firms dropped by Rs 5,98,759.27 crore to Rs 4,49,58,383.92 crore ($5.26 trillion).

“Consolidation in domestic markets is evolving into a broad-based trend, now extending to large-cap stocks. Valuation concerns and rising oil prices -- driven by Middle East tensions -- are fuelling risk aversion among investors.

“Adding to the uncertainty, the US is considering unilateral tariff hikes on several key trading partners, with a decision expected within the next one to two weeks, ahead of an early July deadline,” Vinod Nair, Head of Research, Geojit Investments Limited, said.

The BSE midcap gauge tanked 1.52 per cent and smallcap index dropped 1.38 per cent.

Among sectoral indices, power tumbled 2.19 per cent, utilities (2.18 per cent), oil & gas (2.10 per cent), realty (2.07 per cent), consumer durables (2.02 per cent), industrials (1.98 per cent), auto (1.71 per cent), consumer discretionary (1.67 per cent) and metal

(1.63 per cent).

As many as 2,729 stocks declined while 1,282 advanced and 140 remained unchanged on the BSE.

“The sell-off was triggered by a combination of factors, including renewed geopolitical tensions between Israel and Iran, a rise in crude oil prices, and expiry-related pressure following the breakdown of a key support level. These developments have made market participants more cautious,” Ajit Mishra - SVP, Research, Religare Broking Ltd, said.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 446.31 crore on Wednesday, according to exchange data.

Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said investors exited stocks at will weighed down by weak global sentiment coupled with the possibility of Israel attacking Iran and renewed tariff threat by US President

Donald Trump”.

In Asian markets, South Korea’s Kospi and Shanghai’s SSE Composite index settled in the positive territory, while Japan’s Nikkei 225 index and Hong Kong’s Hang Seng ended lower. Equity markets in Europe were trading in the negative territory.

US markets ended lower on Wednesday.

Global oil benchmark Brent crude declined 1.43 per cent to $68.77 a barrel.

On Wednesday, the 30-share BSE Sensex rose by 123.42 points or 0.15 per cent to settle at 82,515.14. The Nifty ended 37.15 points or 0.15 per cent up at 25,141.40.