Benchmark equity indices plunged on Thursday as investor sentiment weakened following fresh remarks by Donald Trump on the ongoing conflict with Iran, signalling strong US action in the coming weeks.
The S&P BSE Sensex fell 1,401.01 points to 71,733.32, while the Nifty50 dropped 439.55 points to 22,239.85 as of 9:27 am.
According to V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, Trump’s statement that the US would act “extremely hard” against Iran within two to three weeks has once again turned market sentiment negative.
He noted that Brent crude surged around 5% to $105 per barrel, while the US 10-year bond yield rose to 4.36%, exerting mild pressure on gold and silver prices.
Foreign portfolio investors (FPIs) continued heavy selling, offloading equities worth Rs8,331 crore on April 1. Rising crude prices, a widening trade deficit, concerns over declining remittances, and sustained FPI outflows have collectively increased pressure on the rupee, which remains weak despite measures by the Reserve Bank of India to curb dollar futures activity.
Vijayakumar also cautioned that Trump’s statement about concluding the conflict within two to three weeks may not be reliable, given his history of shifting positions.
Amid the broader market weakness, March auto sales data showed resilience in the sector, which could help auto stocks remain relatively stable.