Monday Selloff: Israel and Hamas conflict lead to correction after markets open gap down; Nifty around 19500, Sensex near 65,500

financialexpress.com:

The impact of the conflict in West Asia could well be felt in markets across the world. Dalal Street was no exception. In India, Nifty opened gap down and remained in negative territory throughout the session. It finally ended down 0.7%, around 19500 and the Sensex shut shop at 65,512, down nearly 500 points. The market saw heightened volatility and 27 of 30 index stocks on Sensex ended lower on Monday. All sectors ended in red with major selling seen in PSU Banks, metals and consumer durables. The Adani stock cracked even as the company issued statement highlighting the concerns and employee safety at the Haifa Port.

Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services said, “Concerns over rate hikes after strong US jobs data and a surge in oil prices due to war in West Asia made investors cautious. In the near-term, we expect markets to remain volatile amid geopolitical stress and inflationary pressure ahead of CPI data to be released by the US, Europe and China later during the week.”

Overall investors showed a preference for safe haven assets like gold and dollar. Shrikant Chouhan, Head of Research (Retail), Kotak Securities pointed out that “Investors dumped equity assets as they turned risk off on concerns that a faceoff between Israel and Hamas could further deteriorate. There are concerns that since most of the oil producing nations are close to the conflict zone, a prolonged war could trigger an upsurge in international crude oil prices. With a fresh surge in crude oil prices, higher oil import bill going ahead would stoke domestic inflation and prompt the central bank to take a hawkish stance. With investors preferring gold and dollar assets in times of uncertainty, local stocks across