Stock Market Highlights: Traders Lose Nearly Rs 2 Lakh Crore As India-Pakistan Tensions Spark Risk-Off Mood

The benchmark equity indices extended losses to the second day on Friday as investors pulled their money out on anticipation of escalation in tension between India and Pakistan.

The NSE Nifty 50 closed 207.35 or 0.86% down at 24,039.35, while the BSE Sensex ended 588.90 points or 0.74% lower at 79,212.53. Investors' wealth declined Rs 1.92 lakh crore to Rs 190.15 lakh crore.

The Nifty and Sensex started the session with gains as risk-sentiment fuelled after US Treasury Secretary Scott Bessent said the discussions with India regarding trade was very close to a successful conclusion. Shortly after opening, the Nifty rose 0.49% to the day's high of 24,365.45, and Sensex rose 0.41% to the day's high of 80,130.66.

Two hours into the trade, news of a fire exchange between India and Pakistan near the Line of Control in Jammu and Kashmir sparked a risk-aversion mood. The Sensex slumped 1.5% to the day's low of 78,605.81, and the Nifty declined 1.64% to the day's low of 23,847.85.

The fire exchange happened between India and Pakistan days after 26 Indians lost their lives in the deadliest terrorist attack in over six years at Pahalgam.

Axis Bank Ltd. dragged the Nifty index the most throughout the session. It declined as its net profit declined year on year marginally because of higher provisions.

"Rising geopolitical tensions between India and Pakistan continued to weigh heavily on investor sentiment, prompting a cautious start for Indian equities," said Sundar Kewat, technical and derivatives analyst at Ashika Institutional Equity.

On the NSE, 14 sectoral indices ended lower and one higher out of 15. The NSE Nifty Media dragged the most, while the NSE Nifty IT emerged as the top performer. The Nifty IT index rose on optimism over US and India trade talks.

The BSE Midcap and Smallcap indices ended 2.44% and 2.56% down respectively. On the BSE, 20 sectoral indices out of 21 ended lower with the BSE Services falling the most. Only the Focused IT index rose the most.

The market breadth was skewed in favour of sellers as 1,917 stocks declined, 182 stocks advanced and 10 remained unchanged on the BSE.

However, the benchmark indices recorded second week of gains on positive developments in trade talks between India and US. The NSE Nifty 50 and BSE Sensex rose 0.79% and 0.84% higher respectively.

This week on NSE, the NSE Nifty IT index emerged as the top performer, while the NSE Nifty Media declined the most.