India’s stock markets slumped to their lowest levels in nearly a year today as the Iran war sent crude oil prices soaring, sparking fears of inflation and currency pressure.
The Sensex fell 2,494 points to 76,424, while the Nifty 50 dropped 3.07% to 23,697. Brent crude surged toward $120 per barrel, intensifying investor anxiety.
Almost all Nifty 500 companies traded in the red, with Coal India the lone exception. BPCL and HPCL plunged up to 8% as energy costs spiked. HDFC Bank, ICICI Bank, and Reliance Industries led the losses. Midcap and smallcap indices slipped nearly 1.8%, while India VIX surged over 20% to its highest since July 2024. Investors saw Rs 12 lakh crore in wealth erased in a single day.
Foreign institutional investors sold Rs 6,030 crore worth of shares on Friday, overshadowing domestic inflows. Analysts warned that if the Iran war continues, India—one of the world’s largest oil importers—will face severe macroeconomic challenges. Rising energy costs could widen the fiscal deficit, squeeze corporate margins, and weaken the rupee.
Geopolitical tensions escalated as Iran named Mojtaba Khamenei its new Supreme Leader, signalling hardline continuity. Israel expanded strikes on Iranian commanders in Beirut, pushing the death toll close to 400. Supply disruptions through the Strait of Hormuz, coupled with output cuts from Iraq and Kuwait, compounded fears of prolonged energy shocks.
Economists cautioned that even if hostilities ease, damaged infrastructure and shipping risks may keep fuel prices elevated for months. The Iran war’s impact on India’s economy remains severe, leaving Dalal Street vulnerable to further volatility.
