Sensex, Nifty Show Slight Weakness Amid Geopolitical Developments

Indian equity markets saw a steep selloff on Friday as investors went risk-averse following rising geopolitical tensions after the Pahalgam terror attack in Kashmir. The BSE Sensex fell more than 1,000 points to trade below 78,800, while the NSE Nifty50 fell over 330 points to fall below the 24,000 mark during volatile trading sessions. The market cap of all companies listed on BSE declined by close to ₹10 lakh crore as uncertainty swept over Dalal Street.

 

The selling was caused by escalated India-Pakistan tensions following the attack, which resulted in the killing of 26 civilians and sparked intense diplomatic action, including the suspension by India of the Indus Waters Treaty and reduction in diplomatic relations. Analysts attributed rising risk aversion, as the volatility gauge surged 6% amid frantic profit-taking following a recent surge.

 

More distant markets took larger blows, as midcap and smallcap indexes dropped more than 2%. Analysts indicate further escalation might have a large negative impact on investor sentiment, but some regard the correction as a natural reversion to previous over-bullishness.

 

Source: Economic Times