Summary of this article
Markets fell on a fragile US-Iran ceasefire concerns
IT leads decline, while metals and pharma holds steady
Oil prices rose on Strait of Hormuz closure, while the rupee weakened
Equity benchmark indices snapped their five-day gaining streak as the recently agreed upon US-Iran ceasefire came under threat. The BSE Sensex fell as much as 938.55 points, or 1.21 per cent, to hit an intraday low of 76,624.35. Likewise, the NSE Nifty 50 tumbled up to 237.90 points, or 1 per cent, to the day’s low at 23,759.45.
Midcaps and smallcaps were relatively less affected, as the Nifty Midcap 100 and Nifty Smallcap 100 traded around flat levels, as of the time of writing. Nifty 500, which represents nearly 92 per cent of the free float market capitalisation of the stocks listed on NSE, was down by around 0.40 per cent.
Nifty IT led the losses, declining over 1 per cent. Rate-sensitive sectors such as auto, realty and banking stocks also came under pressure, after having rallied up to 7 per cent following the Reserve Bank of India’s (RBI) decision to keep key interest rates unchanged at its April 6–8 monetary policy committee (MPC) meeting. On the other hand, metals, pharma, healthcare, and PSU banks were trading in green.
Larsen & Toubro, Mahindra & Mahindra, IndiGo, Infosys, HDFC Bank, Jio Financial Services, and Shriram Finance were among the top losers in Nifty 50, while Hindalco, NTPC, Bharat Electronics, Coal India, Power Grid, ONGC, Dr Reddy's Laboratories, and Bajaj Auto were among the top gainers.
In the previous session, Sensex and Nifty had jumped 3-4 per cent as US President Donald Trump announced a temporary truce with Iran, stating that he had agreed to suspend “the bombing and attack of Iran for a period of two weeks.” He also said in a post on Truth Social that the US had received a “10-point proposal” from Iran, which he described as a workable basis for negotiations.
Why Is Stock Market Falling Today
Today's sell-off came as Israel continued carrying out strikes in Lebanon, even as a fragile ceasefire between the US and Iran remained in place.
In response, Iran once again sealed the Strait of Hormuz, a key global oil route that is central to the ceasefire deal.
In Israel, Prime Minister Benjamin Netanyahu’s office said on April 8 that it welcomed the two-week halt in hostilities with Iran, but clarified that the deal does not include Hezbollah, apolitical and militant group based in Lebanon, and backed by Iranian regime.
On the other hand, Pakistan Prime Minister Shehbaz Sharif, who helped broker the ceasefire, said in a post on X that the truce would apply “everywhere,” including Lebanon. However, he did not mention any agreement involving Israel.
This has created confusion and added to the uncertainty among investors, as Israel’s stance suggests that its operations against Hezbollah in Lebanon will continue despite the ceasefire.
Israel has been in a full-scale conflict with Hezbollah since March 2, after the group fired missiles at northern Israel in support of Iran, its long-time ally.
Crude Oil Prices Surge Again
As a consequence of the closure of the Strait of Hormuz, crude oil prices rose again after witnessing a 13-15 per cent crash in the previous session.
The international benchmark Brent crude oil futures was up 2.32 per cent at $97 a barrel, while the US benchmark West Texas intermediate (WTI) crude oil futures was up 3.20 per cent at $97.43 per barrel.
Rupee Slips
Meanwhile, the rupee traded at 92.73 against the dollar, slightly weaker, as uncertainty around the US-Iran ceasefire pushed oil prices higher and made investors cautious.
The US Dollar Index, which measures the greenback against the world's six major currencies, stayed flat at 98.91 level.
