Sensex Opens 610 Points Lower As Crude Tops $100, Global Selloff Deepens

Indian benchmark indices opened sharply lower on Friday, tracking weak global markets as Brent crude surged above $100 a barrel, renewed geopolitical tensions fuelled inflation concerns and investors turned risk-averse.

The Sensex fell 610.07 points, or 0.80%, to 75,781.32, while the Nifty 50 declined 169.15 points, or 0.71%, to 23,700.45 in early trade.

Market breadth remained weak, with 1,376 stocks declining, 559 advancing and 98 remaining unchanged.

Among the Nifty constituents, Cipla, HCLTech, ONGC, Adani Enterprises and Coal India traded higher, while Infosys, Eternal, Bharti Airtel, Dr Reddy's Laboratories and Hindalco were among the top losers.

Crude Surge Rekindles Inflation Worries

Investor sentiment remained under pressure after Brent crude briefly climbed above $100 a barrel, its highest level in months, following renewed hostilities between the US and Iran and fresh Houthi attacks on commercial shipping in the Red Sea.

The escalation has heightened concerns over the security of the Strait of Hormuz and the Bab el-Mandeb Strait, two of the world's most important oil transit routes. The sharp rise in crude prices has renewed fears of higher inflation, increased input costs and tighter monetary policy globally.

The move also pushed US Treasury yields to fresh yearly highs and strengthened the dollar as investors increased bets that major central banks may have to keep interest rates elevated for longer.

Global Markets Stay Under Pressure

Domestic equities mirrored weakness across global markets after another sharp selloff on Wall Street overnight.

The Dow Jones Industrial Average fell more than 500 points, while the S&P 500 lost 1.2%. The Nasdaq Composite tumbled 2.2%, its biggest single-day decline since late June, as disappointing earnings from two technology heavyweights triggered broad-based selling in semiconductor stocks.

Asian markets also traded lower, with Japan's Nikkei 225 falling 2.46%, South Korea's Kospi declining 3.04%, Australia's ASX 200 slipping 0.57%, and China's Shanghai Composite edging 0.01% lower.

The weakness reflected growing concerns over the sustainability of heavy artificial intelligence-related investments, alongside rising geopolitical tensions and higher energy prices.

Higher Oil, Weak Rupee Add To Market Risks

According to V K Vijayakumar, Chief Investment Strategist at Geojit Investments, markets continue to grapple with elevated uncertainty and volatility as the spike in Brent crude to around $100 a barrel revives concerns over India's balance of payments and inflation outlook.

He said the renewed weakness in the rupee, which has depreciated to 96.57 against the US dollar, has prompted foreign portfolio investors to turn sellers again after buying on several sessions earlier this month. Vijayakumar also highlighted the rise in the US 10-year Treasury yield to 4.7% as another key near-term headwind for global equity markets.