Markets Open Weak as Crude at $120, Sensex Falls 900 Points

Indian equity benchmark indices opened sharply lower on Thursday, tracking weak global cues and rising concerns over elevated crude oil prices and foreign outflows.

The BSE Sensex opened at 76,575.21 and slipped over 900 points in early trade to hover around 76,623.84 at 9:30 am. The NSE Nifty50 opened at 23,904.95 and declined 267.15 points or 1.12% to 23,907.50, falling below the key 24,000 mark.

Market weakness was broad-based, with all sectoral indices trading in the red. Broader markets also saw selling pressure, with the Nifty Midcap100 down 1.09% and the Smallcap100 slipping 0.20%.

Oil Surge to $120, Rupee Weakness Add Pressure

The sharp decline comes as crude oil prices surged to $120 per barrel amid the ongoing US-Iran stand-off and continued blockade of the Strait of Hormuz by US forces. Elevated oil prices are a major concern for India, as they can worsen inflation, widen the current account deficit and pressure corporate earnings.

At the same time, the Indian rupee weakened sharply, slipping below the ₹95 per dollar mark, reflecting the impact of a stronger dollar, rising crude prices and continued foreign capital outflows.

VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said two key headwinds are likely to impact markets in the near term. He noted that crude at $120 poses risks to India's growth and inflation outlook, while stronger earnings from AI-driven companies in the US and South Korea could attract capital away from emerging markets like India.

Global Cues Mixed, Fed Pause Offers Limited Relief

Global markets offered mixed signals. Asian indices traded lower, with Japan's Nikkei declining around 1%, Hong Kong's Hang Seng falling 1.3% and China's Shanghai Composite edging slightly lower.

The US Federal Reserve kept interest rates unchanged at 3.50%–3.75%, marking the third consecutive pause this year. The decision came with an 8–4 split vote, reflecting continued caution amid inflation and geopolitical risks.

Vijayakumar said the Fed's decision was largely expected and is unlikely to significantly impact Indian markets. However, the rise in US 10-year bond yields to around 4.4% could encourage further capital outflows, adding pressure on domestic equities.

Investor sentiment remained cautious ahead of key earnings announcements and macro developments. Vijayakumar added that while political developments such as exit polls may offer some comfort, they do not provide fundamental support to the market.

He advised that investors may focus on companies delivering better-than-expected Q4 results and strong forward guidance, as stock-specific opportunities continue to emerge despite broader market weakness.