SENSEX drops over 650 points, NIFTY50 hits low of 24,000 as US-Iran war shakes sentiment

The Indian equity benchmarks staged a gap down opening on Monday, July 13, as investor sentiment was shaken after geopolitical tensions between United States and Iran escalated sending crude oil prices higher.

The SENSEX dropped as much as 712 points and NIFTY50 index touched an intraday low of 24,000 dragged down by losses in HDFC Bank, ICICI Bank, Larsen & Toubro, Bharti Airtel, Bajaj Finance and Reliance Industries.

As of 9:23 am, the SENSEX was down 619 points at 76,950 and NIFTY50 index declined 182 points to 24,025.

Market sentiment towards equities was shaken across the world after the US Central Command (CENTCOM) said that it completed a new wave of offensive strikes against Iran, July 12, hitting dozens of targets at multiple locations with precision munitions to degrade Iran’s ability to continue attacking international shipping flowing through the Strait of Hormuz.

CENTCOM forces struck Iranian military air-defence systems, coastal radar sites, missile and drone capabilities, and small boats using US fighter aircraft, naval vessels, one-way attack aerial drones, and one-way attack sea drones for the first time.

Asian markets were trading sharply lower as closure of Strait of Hormuz sent crude oil prices surging past $79 per barrel. Japan's Nikkei dropped 1.4%, China's Shanghai Composite declined 0.77% and South Korea's KOSPI tumbled 5%.

Brent crude futures rose as much as 4.45% to touch an intraday high of $79.39 per barrel.

Back home, selling pressure was broad based as 13 of 15 major sector gauges compiled by the National Stock Exchange (NSE) were trading lower led by the NIFTY Metal index's 1% fall. NIFTY Auto, Bank, Financial Services, PSU Bank, Private Bank and Realty indices also fell between 0.6% and 0.95%.

On the other hand, select IT and media shares were witnessing a mild buying interest.

Broader markets were also facing selling pressure as NIFTY Midcap 100 index declined 0.5% and NIFTY Smallcap 100 index fell 0.4%.

Among the individual shares, Avenue Supermarts fell as much as 4.24% to hit an intraday low of ₹3,908 after its first quarter earnings failed to enthuse investors.

The operator of DMart retail chain operator reported a net profit of ₹861 crore in the first quarter of current financial year, marking an increase of 11% from ₹773 crore in the same period last year.

Its revenue from operations in April-June period advanced 15% to ₹18,795 crore from ₹16,360 crore in the year-ago period.

Avenue Supermarts posted stable operational performance as its earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 15% to ₹1,499 crore and its EBITDA margin came in at 7.98%.

Just Dial shares advanced as much as 15% to touch an intraday high of ₹648 after its net profit in the first quarter of current financial year advanced 4.1% to ₹166 crore and its revenue advanced 10% to ₹328 crore.

Tata Steel was top loser in the NIFTY50 index, the stock declined 1.93% to ₹187.50. InterGlobe Aviation, Maruti Suzuki, Asian Paints, HDFC Bank, SBI Life, Bharat Electronics, Bajaj Finserv, Eicher Motors, Larsen & Toubro, Ultratech Cement and Nestle India also fell between 0.9% and 1.85%.

On the flip side, TCS, HCL Tech, ONGC, NTPC, Tech Mahindra and Power Grid were notable gainers in the NIFTY50 index.

The overall market breadth was marginally negative as 1,522 shares were declining while 1,335 were advancing on the NSE.