Daijiworld Media Network - Mumbai

Mumbai, Jun 14: Indian equity markets closed the week in the red as initial optimism was overshadowed by sharp volatility triggered by Israel’s airstrike on Iran’s nuclear facilities, dampening global investor sentiment.

Analysts said the geopolitical flare-up led to a global risk-off mood, pushing investors towards gold and US bonds, while crude oil prices surged past $76 a barrel after months of consolidation on fears of supply disruptions.

On the domestic front, CPI inflation eased to a 75-month low, but experts warned that rising oil prices could reverse the trend if the Middle East conflict deepens. “Rate-sensitive sectors like auto, realty and banking witnessed profit-booking, while IT and pharma stocks gained on a weaker rupee,” said Vinod Nair, Head of Research, Geojit Financial Services.

The Nifty 50 slipped 169.60 points or 0.68% to close at 24,718.60 after hitting an intraday low of 24,473. Sectoral indices closed in the red, with PSU Banks losing 1.18%, metals 0.96%, and private banks 1.17%. India VIX spiked over 7%, indicating heightened investor anxiety.

Mid and small-cap indices also fell, with the Nifty Midcap 100 and Smallcap 100 losing 0.4% and 0.5%, respectively. However, defence stocks bucked the trend, attracting sharp buying interest as investors anticipated higher government spending amid escalating security threats.

“Given the current volatility and global tensions, traders should focus on stock-specific opportunities and avoid aggressive bets,” advised Ajit Mishra, SVP – Research, Religare Broking.

All eyes are now on the upcoming US Federal Reserve meeting, where rates are expected to remain unchanged. However, investor focus will be on the Fed’s commentary and economic outlook for cues on future policy moves.