Indian stocks were set for a weak start on Monday after a powerful rally last week, with Gift Nifty down by more than 300 points in early morning trade and pointing to a gap-down opening near the 23,700 zone. The pullback came as tensions in the Middle East escalated after ceasefire talks in Islamabad failed over the weekend.
The shift followed one of the market’s strongest weekly runs in years. From April 6 to 10, the Nifty 50 climbed from 22,713 to 24,050, a gain of 1,337 points and close to 6%. The BSE Sensex rose from 73,319 to 77,550, adding 4,231 points, while Bank Nifty advanced from 51,548 to 55,912, a jump of 4,364 and around 8.50%. For the Indian stock market, it was the best weekly performance in over five years.
Hariprasad K said the negative start was being driven by deteriorating global sentiment after fresh geopolitical escalation in the Middle East. He said the failure of US-Iran negotiations over the weekend raised fears of a prolonged conflict and that reports of a US naval blockade on Iranian ports had worsened the mood. Donald Trump said the United States Navy would begin the process of blockading any and all ships trying to enter or leave the Strait of Hormuz.
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Markets across Asia were also lower on Monday, with South Korea’s Kospi down more than 1% and Japan’s Nikkei slipping more than 0.5%. The pressure spread quickly into commodities: Brent crude surged 8.36% to $103.16 a barrel, while WTI crude futures rallied 8.22% to $104.57 per barrel. European gas futures also spiked almost 18% at one point.
The rally last week had been built on improving global sentiment, hopes of easing Middle East tensions, cooling crude prices, domestic institutional buying, short covering, earnings-season optimism, and stable rupee and bond yields. This week opens with that support fading. Higher oil prices are especially sensitive for India because the country imports crude and faces the risk of faster inflation, currency pressure, and tighter margins for companies across the economy. The Strait of Hormuz, a key passage for Iranian oil exports, is now at the center of that risk.
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For investors, the immediate test is whether Friday’s gains can survive the shock from Monday’s open, or whether the sensex and broader market have to price in a deeper hit from energy costs before the week is through.
