The US airstrikes on Iranian nuclear facilities have rattled global markets, with Indian indices ending in the red on June 23, 2025. The Nifty fell below the 25,000 mark, and the Sensex dropped 511.38 points or 0.62 percent to close at 81,896.79. The escalating conflict between Israel and Iran, now with direct US involvement, has prompted panic selling and driven a significant market correction.
Experts caution that a sustained rise in crude oil prices could further dampen investor sentiment. IT, FMCG, Auto, and Banking sectors saw declines between 0.5-1.5 percent, while media, metal, and capital goods sectors observed gains ranging from 0.5 to 4 percent. Trent, Bharat Electronics, Hindalco Industries, Adani Enterprises, and Adani Ports were among the major gainers on the Nifty.
Ajit Mishra, SVP of Research at Religare Broking, noted that the markets began the week on a volatile note due to the Middle East conflict and weakness in IT heavyweights. Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, highlighted that the Nifty faces a strong hurdle around the 25,100-25,200 levels. Prashanth Tapse, Senior VP (Research) at Mehta Equities, commented that the ongoing conflict and potential rises in oil prices could lead to higher import bills, declining local currency, and inflationary pressures.
Airstrikes rattle Indian markets
However, Foreign Institutional Investors (FIIs) have been net buyers, showing confidence in India’s strong fundamentals. The primary concern for India is the potential surge in crude oil prices, as the country imports over 80% of its crude requirements.
Rising crude prices could widen the current account deficit, fuel inflation, and weaken the rupee due to higher forex outflows. Experts advise investors to be selective with stock picking during this consolidation phase and to keep resources ready to take advantage of any market correction. Staggered investments are recommended to reduce risk due to expected market volatility.
The market outlook remains cautious, with a strong focus on global market performance and crude oil price movement. If Iran does not retaliate aggressively, the market may see some positivity. However, any attacks on the Strait of Hormuz or US bases could escalate tensions further.
As markets brace for a volatile phase, it is crucial for investors to stay informed, maintain a diversified portfolio, and adopt a cautious approach to navigate through this period of uncertainty.