Indian stocks plummet to 14-month weekly low as Middle East goes on the boil

Mumbai: The Indian stock markets slumped to their weakest weekly performance in 14 months, after conflict erupted in the Middle East between the US, Israel and Iran on 28 February.Benchmark indices NSE Nifty 50 and BSE Sensex dropped nearly 3% through the week, marking their steepest decline since the week ended 22 December 2024, when markets had corrected over 4% amid concerns over the US Federal Reserve’s hawkish stance and rising bond yields.On Friday, the Nifty 50 fell 1.27% to close at 24,450.45, while the Sensex declined 1.37% to end at 78,918.88, extending their decline following the prior session’s relief rally.Rising crude oil prices and continued selling by foreign portfolio investors (FPIs) weighed on sentiment. Currency weakness added further pressure, with the rupee hitting a record low of 92.1488 against the US dollar on 4 March (Wednesday).Market volatility also spiked during the week, with the India VIX (Volatility Index)—a measure of the market’s expectation of volatility in the Indian stock market over the next 30 days—rising from 13.70 to 19.88, signalling heightened investor nervousness and expectations of larger market swings ahead.To be sure, Indian equities’ fall was milder than several Asian markets.

While the Nifty 50 fell about 3% during the week, South Korea’s Kospi dropped about 11%, Indonesia’s Jakarta Composite fell nearly 8%, and Thailand’s SET index declined around 7%. China’s Shanghai Composite Index slipped 1.1% for the week.Meanwhile, key US market benchmark S&P 500 fell 0.7%, while the Nasdaq Composite rose 0.4%.In India, the dim mood was reflected across sectors, with most indices ending the week in the red.