Indian benchmark indices remained under pressure on Tuesday, with the Nifty 50 falling as much as 0.47% to 23,676. The Sensex declined as much as 0.55%, or over 400 points, to 75,756.
Sectoral indices are trading mixed, with Defence up 2%, and Realty down nearly 1%.
Three factors are weighing on domestic equities: rising crude oil prices amid escalating US-Iran tensions, weakness across key sectors, and continuing selling pressure in the benchmarks.
Rising Crude Prices
Oil prices held near $100 a barrel as traders weighed the prospect of an Iran-Oman arrangement to manage shipping through the Strait of Hormuz against renewed buying by China and continued risks to regional energy supplies.
Brent crude has gained 1.6% over the past two sessions, while West Texas Intermediate was trading above $92. Brent briefly moved above $98 on Monday as escalating US-Iran tensions pushed the benchmark to its highest level in nearly six weeks.
"Persistently high oil prices remain a key risk" for India as they could increase the import bill, add to inflationary pressure and strain the current account, said Ponmudi R, CEO of Enrich Money.
Sectoral Weakness
Sectoral indices were largely in the red in early trade on Tuesday, with Nifty IT falling 0.86% and Nifty Realty declining 0.59%, making them the worst-performing sectors at market open.
As of 10 am, Nifty Realty was the worst-performing sector, falling 0.83%, followed by Nifty Financial Services (-0.68%), Nifty Auto (-0.59%), Nifty Oil & Gas (-0.56%) and Nifty Rural (-0.56%). Nifty Consumption declined 0.42%, while Nifty Bank and Nifty IT slipped 0.37% and 0.25%, respectively.
On the other hand, Nifty PSU Bank fell 0.24%, Nifty FMCG declined 0.09% and Nifty Energy slipped 0.05%. Among gainers, Nifty Pharma rose 0.14%, Nifty Metal advanced 0.47%, Nifty Media gained 1.33%, while Nifty India Defence emerged as the top performer with a 2.17% rise.
Selling Pressure
The Sensex has gone 697 days without hitting a fresh all-time high, marking the fourth-longest stretch without a new record peak in the 21st century, according to Reuters data.
The longest such pauses were 1,089 days between November 2010 and October 2013, 1,030 days between January 2008 and November 2010, and 792 days between January 2015 and March 2017.
The current spell began in September 2024 and remains ongoing, highlighting an extended period of consolidation in Indian equities despite intermittent market rallies.
"Nifty 50 is likely to remain under pressure," Ponmudi said. He identified 23,750-23,700 as immediate support and 23,600 as a key level, while a move above 24,000 could improve momentum.
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