The Indian stock markets saw a strong decline on Friday (June 13). Israel’s sudden air strike on Iran shocked investors. Due to this news, the BSE Sensex dropped by 1337 points to a low of 80,354.5 in early trade. On the other hand, the Nifty 50 index fell by 415 points to sliding below 24,500 to 24,473 levels.
Boddar markets also saw weakness. The Nifty Midcap index recorded a decline of 1.35% and the Nifty Smallcap index by 1.55%. All the sectoral index appeared in the red mark today. Nifty Auto, Nifty PSU Bank and Nifty Metal Index fell by about 1.5%.
Reason for decline on Friday, June 13?
1. Israel attacked Iran on Friday. According to Israeli Prime Minister Benjamin Netanyahu, the campaign targeted the “main part of Iran’s nuclear program”. It consisted of Natanj Nuclear Facility and major nuclear scientists.
At a time when tension between Russia-Ukraine continues and recently it has increased even more, Israel-Iran struggle is a new shock for markets. Geophysical stress has become the biggest concern for investors.
Market experts say that stress may increase further and can take the form of a major conflict in the middle East. Netanyahu said that the attack against Iran will continue for as long as it is.
2. The prices of WTI crude and Brent crude increased by more than 10 percent after the Iran-Israeli conflict attacks amidst concerns of interruption in supply from the Middle East. India, one of the world’s largest crude oil importers, is particularly weak. There is no good news for the country fiscal. This can increase the pressure of inflation again, which is recently decreasing.
3. Japan’s Nikkei index fell 1.16 percent due to geopolitical tension. While the topics index fell by more than 1 percent. South Korea’s cospie lost 0.67 percent and Australia’s ASX 200 index slipped 0.17 percent.
Australia’s S&P/ASX 200 declined by 0.23 percent. Hong Kong’s Hang Seng index declined by 0.98 percent. While Mainland China’s CSI 300 declined by 0.78 percent. American fusures also drowned in pre-market trading. The Nasdaq Composite Futures fell 374 points or 1.7 percent, while the S&P 500 futures fell by 1.6 percent. Dow Jones Futures also decreased by 1.47 percent.
Investors drowned 8 lakh crores in 2 minutes
As soon as the market opened, the assets of investors decreased by more than Rs 8 lakh crore. The market cap (MCAP) of the companies listed in BSE was Rs 450,52,928 crore after the market on Thursday. Whereas as soon as the market opened on Friday, it came to Rs 442 lakh crore. In this way, the wealth of investors decreased more than Rs 8 lakh crore in two minutes.