Sensex falls 570 pts, Nifty below 24,750 as Middle East tensions keep investors on edge

Adani Ports, Hindalco, IndusInd Bank, SBI, and ITC were among the major laggards.

Benchmark indices Nifty and Sensex logged a second straight day of losses, as rising tensions in the Middle East and lingering trade uncertainties rattled investor sentiment. A broad-based sell-off gripped the market, with all major sectoral indices slipping into the red and India VIX surging over 7 percent, signalling mounting nervousness.

At close, the Sensex was down 573.38 points or 0.70 percent at 81,118.60, and the Nifty was down 169.60 points or 0.68 percent at 24,718.60. About 1520 shares advanced, 2326 shares declined, and 124 shares unchanged.

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"The Israeli strike could have significant economic repercussions if the conflict with Iran drags on. With Israel stating that the operation may continue for several days, Brent crude has already surged nearly 12 percent to $78 a barrel. Prices could climb further if Iran retaliates by closing the Strait of Hormuz, a key oil supply route. The market's reaction will largely hinge on the duration of the conflict, but in the near term, a risk-off sentiment is likely to dominate," V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said.

Sectoral indices on the NSE traded largely in the red, with the Nifty PSU Bank index leading the losses, down 1.51 percent, followed by Nifty Metal and Nifty Bank, which dropped 1.23 percent and 1.17 percent, respectively. FMCG, Infrastructure, Energy, and Private Bank indices also saw cuts of over 1 percent. Among broader markets, the Nifty Midcap 100 and Smallcap 100 declined 0.4 percent and 0.5 percent, respectively. The Nifty IT index, which had opened in the green, ended flat. Meanwhile, India VIX jumped 7.56 percent to 15.08, indicating rising market volatility.

Also read: Gold prices breach key Rs 1 lakh level to hit record high amid Middle East tensions

Indian shipping stocks were in high demand on June 13, outperforming a weak broader market, as escalating tensions in the Middle East sparked fears of global trade disruptions and rising tanker rates. Shares of Shipping Corporation of India and GE Shipping surged up to 10 percent, emerging as top gainers on the Nifty 500 index. Investor appetite for shipping counters remained strong amid expectations of higher freight and tanker rates, as ships are likely to reroute to avoid the increasingly volatile Strait of Hormuz, a critical artery for global oil and gas transport.

Defence stocks significantly surged on June 13 as the war between Israel and Iran continued to escalate, fueling hopes of higher defence equipment orders amid heightened global uncertainties. The sharp rise in the share prices pushed the Nifty India Defence index up 2.5 percent to snap a two-day losing streak.

The higher highs and higher lows remain intact on the broader time frame, but the bearish engulfing pattern raises near-term caution. The RSI has dropped from 60 to 55, indicating a decline in momentum. The Average True Range (ATR) has risen slightly, increasing intraday volatility. The immediate support remains at 24,800; a break beneath this zone could invite a sharper slide, whereas 25,100 remains a formidable ceiling on the upside.

Read more: Mutual funds go bargain hunting in May, buy Rs 29,000 crore of shares from exiting promoters, FIIs

"The Nifty Bank index saw mild profit booking, pulling back towards the 20-Day SMA, which now acts as immediate support. However, the primary trend remains intact as the price holds well above the medium-term moving averages. The index is currently hovering near the previous breakout zone of 56,000–56,200. A sustained breach below this zone could open the gates for further downside towards the next support at 55,300. On the upside, 56,700 continues to pose immediate resistance. Currently, caution is warranted, as a break below 55,300 may weaken the trend and shift the near-term outlook to negative," Om Mehra, Technical Research Analyst at SAMCO Securities, said.

Top gainers on the Nifty included Bharat Electronics, ONGC, Tech Mahindra, TCS and Wipro.

On the losing side, Adani Ports, Hindalco, IndusInd Bank, SBI, and ITC were among the major laggards.