The Indian markets declined by more than one per cent on Friday due to the increasing struggle between India and Pakistan. The benchmark Sensex fell 1.1 per cent, ie 880 points to close at 79,454 during the last two trading sessions. The Nifty-50 index also slipped at 1.1 per cent i.e. 266 points to 24,008. During the trading session, the Sensex and Nifty moved to a low of 78,968 and 23,936 respectively.
On Friday, foreign portfolio investors sold shares worth around Rs 3,800 crore to put a break on their 16 consecutive days of purchases. Analysts said that the concerns of investors are increasing about the possible economic impact of the ongoing border conflict between India and Pakistan. After the terrorist attack in Kashmir last month, India targeted terrorist bases in Pakistan, which continues to attack and firing from across the border.
The CLSA said in a note, “Gujarat, Rajasthan, Punjab and Jammu and Kashmir have strategically important economic properties, bordering Pakistan. Companies with large investment in border states include Adani Port, Electricity and New Energy Sites, Reliance Industries Refinery and New Energy Complex, Power Grid’s large sub-stations, NHPC hydroelectric projects and Mr. Cement, Tata Chemicals and Vedanta’s industrial facilities. If the situation persists for a long time, then the power grid from Jammu and Kashmir may delay capital expenditure in border areas such as HVDC (high-voltage direct current) line from Jammu and Kashmir.
Power grid shares declined by 2.7 per cent and it became the second worst performing stock after ICICI Bank on Nifty with a weakness of 3.2 per cent. UltraTech Cement and Grassim also declined by more than 2 per cent. The market capitalization of all the companies listed in BSE fell to Rs 416.4 lakh crore and in two sessions it decreased by Rs 7.7 lakh crore. The benchmark indices also broke the series of three weeks, which was the longest series of their lead this year.
The NSE Wicks index, which measured market fluctuations, rose 3 per cent to 21.63 on Friday after a 10 per cent rise on Thursday. According to Bajaj Broking, this growth reflects the growing concern of investors. Due to the VIX being above 20, market participants hope that the prices of shares will remain unstable in the near future. NSE closed with just four leads out of 17 sector indices. The highest loss index was Nifty Financial, Nifty FMCG and Nifty IT.
Confirmation of Britain-US trade agreement and reports about the US-China trade talks rose in global markets on Friday. India’s markets performed weakly than most global competitors due to tension on the border. Domestic institutional investors (DIIs) mainly put a slight stop to the market fall due to cash support of mutual funds. According to exchange data, DII was a net buyer of Rs 7,300 crore on Friday.
The founder of Equinomics G. Chokalingam said, although DII’s investment remains stable. But retail investors are expressing concern and there has been a decrease in shopping activities, the effect of which is visible on the performance of small and midcap stocks.
First Published – May 9, 2025 | 10:51 pm IST
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