Indian stock markets began the week on a weak note on Monday, May 18, following negative global cues, rising tensions in West Asia and a sharp jump in crude oil prices.Benchmark indices declined more than 1 per cent in early trade, while market volatility also increased. The NIFTY 50 dropped 251 points, or 1.01 per cent, to 23,394.95, while the BSE SENSEX fell 833 points, or 1.11 per cent, to 74,404.98.
Broader markets also remained under pressure, reflecting weak investor sentiment across sectors.Banking and financial stocks led the losses. The NIFTY BANK declined 1.35 per cent to 52,986.30, while Nifty Financial Services slipped 1.38 per cent. Midcap and smallcap stocks also witnessed heavy selling, with the Nifty Smallcap 100 falling 1.33 per cent and Nifty Microcap 250 down 1.46 per cent.Among sectoral indices, consumer durables, PSU banks, realty and media stocks were among the worst hit. Private banks, automobile and metal shares also traded lower.Defensive sectors showed better resilience.
Nifty IT remained almost flat with a marginal decline of 0.02 per cent, while pharma stocks fell only 0.31 per cent. Healthcare stocks also outperformed the broader market as investors shifted towards defensive and export-oriented sectors amid uncertainty surrounding crude oil prices and currency movements.
India VIX, the market’s volatility index, rose 2.75 per cent to 19.31, indicating increased nervousness among investors.Brent crude oil prices surged 1.83 per cent to $111.26 per barrel, emerging as a major concern for Indian markets due to the country’s heavy dependence on oil imports.
Rising crude prices can increase inflation, weaken the rupee and impact company profits, especially in sectors dependent on fuel and transportation costs.V K Vijayakumar said the market was expected to remain weak because of global developments and elevated crude prices.
He noted that higher oil prices could lead to another round of petrol and diesel price hikes, negatively impacting inflation.He also pointed to the rise in US 10-year bond yields to 4.62 per cent as another negative factor for emerging markets, warning that the rupee could weaken further and trigger continued foreign investor selling.
Vijayakumar added that export-oriented sectors such as pharmaceuticals may remain relatively resilient, while fundamentally strong private sector banking stocks could offer long-term investment opportunities despite current pressure.
Overall market breadth remained weak in early trade, with selling seen across banking, oil & gas, metals and consumer-focused stocks.