India's three largest lenders by market value, HDFC Bank Ltd., ICICI Bank Ltd. and State Bank of India Ltd. on Wednesday erased over Rs 55,000 crore in market capitalisation after Nifty and Sensex posted a near 2% decline. This comes as investors remained on edge with no signs of an end to the Iran war and the disruption to energy supplies threatening economic activity.
They were also among the primary contributors to the Nifty 50 fall in the mid-week trading.
Shares of HDFC Bank and SBI closed nearly 2% lower, whereas ICIC Bank was down 1.3%. While HDFC Bank wiped out Rs 23,846 crore, ICICI Bank and SBI erased Rs 12,369.83 crore and Rs 19,476.60 crore respectively.
Intraday, HDFC Bank slipped 2.57%, SBI was down 2.18% and ICICI Bank fell 1.6%.
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Similarly, the Nifty index, comprising the 50 largest and most liquid stocks, ended nearly 400 points or 1.6% lower at 23,866.85. Among them, 42 stocks declined and eight rose. The index slipped below its immediate support of 24,000 points to a level last seen in April when the US unleashed its 'Liberation Day' tariff policies.
Bajaj Finance Ltd. and Axis Bank Ltd. dropped over 4%, the most on the Nifty. Relentless foreign capital outflows, lack of positive domestic triggers and heightened tensions in the Middle East kept sentiments dampened.
The war between the United States and Israel and Iran entered its 12th day with no concrete resolution in sight. International oil prices fell sharply from multi-year highs, while concerns shifted to securing energy supply. Global benchmark Brent traded below $88 per barrel and West Texas Intermediate dropped near $83 following reports that the International Energy Agency is proposing the largest ever oil release in its history, in an attempt to tackle the ongoing supply shortage.
However, in India, the concerns have more to do with supply of natural gas to consumers and businesses. The government has instructed oil marketing companies to prioritise households and priority sectors like hospitals and educational facilities for supply of liquefied natural gas.
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