Sensex Tumbles 550 Points as Iran-US Tensions Hit Banks, Metals

Indian equities fell sharply on Monday as escalating military conflict between Iran and the United States drove a broad risk-off move across Asian markets. The Sensex dropped more than 550 points. The Nifty50 slipped below the 24,250 mark, with losses concentrated in banking, metals, and oil-linked names.

The selloff followed reports of direct exchanges between Iranian and U.S. forces over the weekend. Traders said the development raised the probability of supply disruptions in the Gulf region. Crude oil futures jumped more than 3% in early Asian trading, compounding pressure on Indian refiners and airlines, which face higher fuel costs. The Nifty Oil & Gas index fell 2.1%. Reliance Industries and ONGC were among the top drags.

Banking stocks also took a hit. HDFC Bank, which carries an Alpha Score of 49/100 and a Mixed label, lost 1.8%. The broader Nifty Bank index dropped 1.5%. SBI and Axis Bank each fell more than 2%. Traders cited concerns that sustained crude strength could widen India's trade deficit and push the Reserve Bank of India to hold rates higher for longer.

Metal stocks reversed course after rallying in recent weeks on hopes of a China-led demand recovery. The Nifty Metal index fell 2.3%, led by Tata Steel and Hindalco. Analysts said the geopolitical risk premium was repricing across commodities. Gold briefly topped $2,400 an ounce before settling near $2,385.

Technology stocks offered some cushion. Infosys, with an Alpha Score of 57/100 and a Moderate label, edged up 0.3%. Wipro, scoring 46/100 and a Mixed label, was flat. The sector tends to benefit from a weaker rupee, which slipped past 83.50 against the dollar during the session.

Defence and public-sector stocks saw selective buying. Shares of GMDC, which hit a 52-week high on a volume spike last week, continued to attract interest. Broader sentiment remained fragile. The Nifty PSU index managed a marginal gain of 0.2%.

Foreign institutional investors were net sellers on the day, offloading roughly ₹1,200 crore in cash equities, provisional exchange data showed. Domestic institutions bought about ₹800 crore. The gap left the market net negative.

The VIX, India's volatility gauge, jumped 8% to 14.6, its highest level in three weeks. Options data showed the highest put writing at the 24,000 strike on the Nifty, suggesting traders expect further downside before any recovery.

Oil prices will dictate the near-term path. A sustained move above $85 a barrel for Brent would pressure fiscal math and corporate margins alike. The next scheduled trigger is Wednesday's U.S. crude inventory report, which will show whether supply fears are translating into actual stock draws.