Nifty Below 24,000, Sensex Down Over 800 Points — Key Factors Behind Stock Market Decline

Indian stock markets came under heavy selling pressure on Friday morning, amid rising geopolitical tensions between India and Pakistan, triggering investor panic and heightened volatility across asset classes. The benchmark BSE Sensex plunged over 800 points intraday, while the Nifty 50 slipped below its crucial 200-day exponential moving average support of 24,050.

The Nifty 50 opened at 23,935 and briefly climbed towards 24,000 levels on value buying, but remained below the 200-DEMA, reflecting ongoing weakness.

The Sensex opened lower at 78,968 and despite recovering to cross the 79,000 mark, it still traded over 800 points lower, hovering around 79,925. Intraday, Nifty 50 was down 1.39% at 23,935.75, and the Sensex had fallen 1.70% to 78,968.34.

"Heightened border tensions and weak global cues dragged down markets and the rupee," said Shrikant Chouhan, head of equity research, Kotak Securities.

Reflecting the elevated nervousness, the India VIX index—often referred to as the fear gauge—jumped 6% in Friday’s session.

On Thursday, both indices had opened on a firm footing—Nifty at 24,431.50 and Sensex at 80,912.34—but failed to hold on to gains. The Nifty 50 closed down 140.60 points, or 0.58%, at 24,273.80, while the Sensex ended 411.97 points lower at 80,334.81.

The market mood turned risk-averse after Pakistan reportedly launched multiple attacks and violated ceasefire agreements along the Line of Control in Jammu and Kashmir late Thursday night. According to the Additional Directorate General of Public Information, the Indian Army successfully repelled these attempts, which included the use of drones and missiles targeting military installations in Jammu, Pathankot, and Udhampur.

This was in response to Indian forces targeted strikes on terror camps in Pakistan and Pakistan Occupied Kashmir under ‘Operation Sindoor’.

"This escalation has raised investor concerns and is likely to lead to heightened intraday volatility," said Vikas Jain, head of research at Reliance Securities.

Meanwhile, the Indian rupee opened 13 paise lower at 85.85 against the US dollar, extending its recent losses. On Thursday, the rupee had already fallen sharply by 89 paise to close at 85.72.

"While the rupee is likely to remain under pressure in the near term, the moment there is a sign of de-escalation, we may see a rapid reversal as well. Considering that the event is a known unknown, exporters and importers are advised to not overhedge and tread with caution, even considering possible trade and travel disruptions if the situation snowballs into a full-fledged war," said Abhishek Goenka, founder and chief executive officer of India Forex Asset Management at IFA Global.

Globally, markets remained mixed. Hong Kong’s Hang Seng dipped 0.1%, the Shanghai Composite lost 0.3%, and Seoul’s markets also dropped. In contrast, Japan’s Topix index rose 1.3%, marking its 11th straight session of gains—the longest streak since October 2017.

Adding to investor worries, US Commerce Secretary Howard Lutnick indicated prolonged timelines for trade deals with Japan, South Korea, and India. US President Donald Trump also remarked that negotiations with India would require “a lot of work”, reinforcing the perception that Indian negotiators remain tough at the bargaining table.

Check latest updates on the India-Pakistan tensions here.