Mumbai, Sep 11: Benchmark indices Sensex and Nifty tumbled in early trade on Friday on soaring crude oil prices amid escalating tensions in West Asia.
Weak trends in global markets and foreign fund outflows also dented investors’ sentiment.
The 30-share BSE Sensex fell 628.24 points to 74,257.69 in early trade. The 50-share NSE Nifty dropped 221.20 points to 23,255.10.
Among the 30 Sensex firms, Bajaj Finance, InterGlobe Aviation, Mahindra & Mahindra, Tata Steel, UltraTech Cement and Axis Bank were the major laggards.
Tech Mahindra, HCL Tech, Infosys, Bharti Airtel and ITC were the gainers.
Brent crude, the global oil benchmark, traded 0.95 per cent higher at USD 108.7 per barrel.
“Brent crude has climbed to its highest level since May as the ongoing US-Iran conflict continues to disrupt oil flows from the Middle East. For India, crude near USD 110 a barrel would further intensify pressure on inflation, the rupee, the current account and corporate margins, while reducing the scope for monetary easing,” Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, a Research Analyst firm, said.
Global markets are trading lower as elevated oil prices intensify concerns over inflation and the interest-rate outlook, he added.
In Asian markets, South Korea’s Kospi, Japan’s Nikkei 225 index, Shanghai’s SSE Composite index and Hong Kong’s Hang Seng index traded significantly lower.
US markets ended in negative territory on Thursday.
“WTI crude is trading in the USD 103–104-per-barrel range after rising around 7.5 per cent in the previous session, while Brent has moved toward the USD 108 mark amid escalating tensions involving Houthi forces and Saudi Arabia. The sharp increase in crude prices is likely to heighten concerns over India’s import bill, inflation and corporate margins, keeping risk appetite subdued,” Ponmudi R, CEO of Enrich Money, an online trading and wealth-tech firm, said.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 438.24 crore on Thursday, according to exchange data.
On Thursday, the Sensex advanced 138.36 points, or 0.19 per cent, to settle at 74,902.59 on last minute buying. The Nifty edged higher by 46.30 points, or 0.20 per cent, to end at 23,477.80. (PTI)
