Markets tank in early trade as Middle East tensions flare-up

Equity benchmark indices tanked in early trade on Friday, taking their losing streak to the fifth day running, as escalating tensions in the Middle East weighed heavily on investors’ sentiment.

Fresh foreign fund outflows, uptick in Brent crude oil prices and decline in IT stocks also added to the overall weak sentiment in equities.

The 30-share BSE Sensex tanked 672.53 points to 71,816.46. The NSE Nifty dropped 218.2 points to 21,777.65.

From the Sensex basket, Infosys declined over 2 per cent after the company’s revenue growth guidance for FY25 failed to meet market expectations.

The company expects a revenue growth of 1-3 per cent in constant currency for FY25 and an operating margin of 20-22 per cent.

“Infosys guided for 1-3 per cent constant currency revenue growth for FY25, missing expectations,” as per a report by JM Financial Institutional Securities.
Axis Bank, HCL Technologies, Asian Paints, Larsen & Toubro, Tata Motors, Tata Consultancy Services and Nestle India were the other major laggards.
ITC and HDFC Bank were the gainers.

In Asian markets, Seoul, Tokyo, Shanghai, and Hong Kong were quoting in the negative territory. Wall Street ended mostly lower on Thursday. Global oil benchmark Brent crude climbed 2.27 per cent to USD 89.09 a barrel.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 4,260.33 crore on Thursday, according to exchange data.

“Reports of the feared escalation of the Iran-Israel tensions have spooked the markets. Distinct weakness in Asian markets and sharp cuts in US futures reflect heightened nervousness in equity markets,” said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Meanwhile, the 2024 Lok Sabha polls kicked off on Friday with the beginning of polling for the first phase.

The BSE benchmark tanked 454.69 points or 0.62 per cent to settle at 72,488.99 on Thursday. The NSE Nifty declined 152.05 points or 0.69 per cent to 21,995.85.