MUMBAI — Indian equity benchmark indices Sensex and Nifty drifted lower in early trade on Monday, weighed down by a sharp uptick in global crude oil prices amid intensifying geopolitical friction in the Gulf region.
The 30-share BSE Sensex initially opened with a modest decline of 19.38 points at 78,479.79. However, as selling pressure extended across key sectors, the index retreated further by 158.62 points to trade at 78,340.55. Similarly, the broader 50-share NSE Nifty skidded 5.10 points early on before slipping 45.20 points to touch 24,524.95.
Crude Oil Surge Weighs on Sentiment
The primary drag on domestic equities was the ongoing rally in international energy markets. Global benchmark Brent crude rose 1.03% to $84.41 per barrel, marking its third consecutive session of gains.
"Elevated crude prices remain a key risk," said Rajesh Palviya, Head of Research at Axis Direct. "Brent crude has risen to around $84.4 a barrel after Iran indicated no immediate reopening of the Strait of Hormuz, while weekend attacks on Gulf shipping have kept the geopolitical risk premium elevated."
Top Losers and Gainers
In the Sensex pack, heavyweights across banking, aviation, and energy felt the pressure. Eternal, State Bank of India (SBI), InterGlobe Aviation (IndiGo), Power Grid, NTPC, and Bharti Airtel featured among the major laggards.
On the flip side, select technology and consumer names provided a cushion to the downside. Titan, Infosys, Tech Mahindra, and HCL Tech traded in the green during early morning deals.
FII Activity and Corporate Earnings Support
Despite the cautious start, underlying institutional flows and corporate fundamentals offered some support. According to exchange data, Foreign Institutional Investors (FIIs) remained net buyers in the domestic market, purchasing equities worth ₹480.24 crore on Friday.
Market experts noted that strong corporate performance in the June quarter continues to anchor long-term investor confidence.
"The undertone of the market is mildly bullish. The principal bullish factor is the better-than-expected Q1 results," explained Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited. "With the earnings season coming to an end this week, the vast majority of companies have reported earnings growth that has beaten expectations. FIIs turning net buyers in July and continuing their momentum in August is another major positive factor."
Global Market Overview
The muted opening in domestic markets stood in contrast to broader Asian equities, which traded higher following a positive close on Wall Street last Friday.
South Korea's KOSPI, Japan's Nikkei 225, Shanghai's SSE Composite, and Hong Kong's Hang Seng index all advanced in early trading.
"Asian markets are trading higher, with Japan's Nikkei 225 and South Korea's Kospi each advancing more than 1 per cent, providing a constructive backdrop for regional equities," stated Ponmudi R, CEO of Enrich Money.
In the previous trading session on Friday, August 7, the Sensex had dropped 455.59 points (0.58%) to settle at 78,499.17, while the Nifty fell 65.35 points (0.27%) to close at 24,570.65.
