Sensex Falls Over 500 Points, Nifty Below 22,600; Oil Prices Spike

The Indian Markets opened in red on Monday as domestic indices reflected global anxiety over geopolitical developments.

The 30-share BSE Sensex declined 270.13 points to 73,049.42 in early trade. The 50-share NSE Nifty dropped 93.60 points to 22,619.50.

Later, the BSE benchmark traded 509.77 points lower at 72,822.60, and the Nifty quoted 141.20 points down at 22,571.90.

From the 30-Sensex firms, Reliance Industries, Kotak Mahindra Bank, Sun Pharma, InterGlobe Aviation, Adani Ports and ICICI Bank were among the major laggards.

Wipro, Hindalco Industries, Titan and Trent are among major gainers on the Nifty.

Brent crude, the global oil benchmark, climbed 0.74 per cent to USD 109.8 per barrel.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 9,931.13 crore on Thursday, according to exchange data. Domestic Institutional Investors (DIIs), however, bought stocks worth Rs 7,208.41 crore.

Ajay Bagga, Banking and Market Expert, noted that the market remains on a knife-edge due to a 24-hour extension of a deadline regarding Tehran.

He observes that while some Asian markets show gains, the domestic sentiment faces pressure from heavy foreign institutional investor positioning.

"The new deadline for Iran to reopen the Strait of Hormuz is now Tuesday evening (US time). Trump has vowed to strike civilian infrastructure--specifically power plants and bridges--if a deal isn't reached," he added.

How Are FII Positions and GIFT Nifty Signaling Pressure on Indian Markets?

Speaking about the Indian market, Bagga noted that, "GIFT Nifty is signaling a gap-down start, trading lower."

"FII sentiment remains heavy, with short positioning in index futures hovering near 83%. Expect volatility as Dalal Street reacts to the weekend's 'ultimatum' rhetoric. However, any positive news from the Iran war could lead to a sharp reversal as we saw on Thursday," he added.

Shrikant Chouhan, Head of Equity Research at Kotak Securities, pointed out that while certain sectors showed strength, the overall chart formation suggests underlying negativity despite potential pullback signals.

"In the last truncated week, the benchmark indices experienced volatile activity," Chouhan said.

"After a roller coaster ride, the Nifty ended 0.50 percent down, while the Sensex was down by 264 points. Among sectors, the Pharma and Healthcare indices lost the most, shedding nearly 3.5 percent, whereas the IT index was the gainer, rallying 2.75 percent," he added.

"Technically, the market is still holding a lower top formation on daily charts, which is largely negative. However, momentum indicators suggest that a pullback formation is likely to continue in the near future," he said.

Regarding specific levels, Chouhan views the 22,400 to 22,500 range for the Nifty as a critical threshold for maintaining the current uptrend.

He indicated that any breach below these support levels makes the market vulnerable to further declines toward lower psychological marks.

Can Bank Nifty Sustain Its Reversal or Will Key Levels Trigger Fresh Weakness?

"For Bank Nifty, it has also formed a promising reversal pattern on daily and intraday charts," Chouhan said.

"In the near future, 50,500 would be the key level to watch. Above this, the index could move up to 52,500-53,000. However, if it falls below 50,500, the sentiment could turn negative. Below this level, it could retest the levels of 50,000-49,700," he added.

Sunil Gurjar, SEBI-registered analyst and Founder of Alphamojo Financial Services, explained that the Nifty 50 remains flat as buyers attempt to defend lower levels through specific candle formations.

"Technically, the index has formed a hammer candle near an important support zone, which suggests that buyers are trying to defend lower levels," he said.

"A bounce back from current levels could lead to further upside toward resistance, while a breakdown below support may trigger fresh downside pressure," he added.

(With inputs from ANI)