Sensex, Nifty extend losses to 5th day as Israel's fresh 'attack' on Iran spooks investors

Israel launched a retaliatory attack on Iran on April 19 morning just days after Iran bombarded 300 missiles and drones on the forme

The Sensex and the Nifty traded lower for the fifth straight day on April 19 on reports that Israel had launched fresh missiles on Iran, leading to a spike in oil and gold prices as worries mounted about the global economy.

Analysts expect market volatility to prevail over the next few days as geopolitical tensions dilute investors' risk-appetite.

In early trade, the Sensex was down 490.71 points, or 0.68 percent, at 71,998.28, and the Nifty was down 152.80 points, or 0.69 percent, at 21,843.00. The market breadth weighed towards losers — 606 shares advanced, 2,031 declined and 81 were unchanged.

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Deepak Jasani, Head of Retail Research, HDFC Securities now expects Nifty to head towards 21,710 on the downside, while 22,148-22,214 band can offer some resistance in the near-term. He expects uncertainity to prevail in the near-term as investors grapple with geopolitical tensions in the Middle-East, elevated bond yields, and corporate earnings season.

Anand James, Chief Market Strategist, Geojit Financial Services too forsees downside momentum to extend in the near-term. "Nifty's 20,300 move is well underway and we prefer to ride the downside momentum until 21,500 initially, which is from where bargain hunting may resume. The upside market is at 22,150," he noted.

Meanwhile, broader markets underperformed benchmark indices within the first hour of trade. BSE Midcap and BSE Smallcap slipped up to 1 percent. India VIX, which measures near-term volatility rose more than 5 percent to 13.81.

All sectors drowned in the sea of red on April 19 morning. Nifty IT, Nifty PSU Bank, and Nifty Realty indices were the worst hit as they slipped over a percent each.

ALSO READ: Analysts fear heightened supply risks as Middle East crisis sends crude soaring over 3%

Global markets turn sour as Middle-East tensions mount

As events in the Middle-East unfold, global markets too turned sour on April 19. The US-linked equity futures slipped in the negative territory, with Dow Jones Futures dropping over 400 points, followed by 200 points fall of NASDAQ Futures.

Elsewhere, Japan's Nikkei 225 led losses in Asian markets as it fell over 3 percent, while South Korea's Kospi was down 2 percent, and Australia's S&P 200 index dropped 1 percent this morning.

On the commodity front, oil prices boiled on reports of Israel's attack on Iran. Brent Crude and WTI Crude prices were up 3 percent each to $90 per barrel and $85 per barrel, respectively.

Investors flocked to safe-haven assets, with gold prices hovering near all-time high of $2,400 troy ounce in early morning deals.

At this time of uncertainity, market experts suggest investors to wait out and rely on quality largecaps, wherein the margin of safety is high.

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