‘Nothing new’ from Trump spooks Dalal Street; Sensex, Nifty slide over 2%

Indian stock markets saw a sharp fall in early trade on Thursday, with investors reacting nervously to US President Donald Trump’s latest remarks on the ongoing Middle East conflict. Within minutes of opening, both benchmark indices dropped more than two per cent, wiping out gains made in the previous session.

The slide comes after a brief recovery on Wednesday, when markets had risen on hopes of easing tensions. Those expectations were dashed after the latest developments suggested no immediate end to the conflict.

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At around 9:16 am, the BSE Sensex was down 1,518.29 points, or 2.08 per cent, at 71,616.03. The NSE Nifty 50 also declined 462.50 points, or 2.04 per cent, to 22,216.90.

No ceasefire clarity keeps markets on edge

Experts said the market reaction reflects disappointment over the lack of any clear de-escalation signals.

Market and banking expert Ajay Bagga said, “Trump Speech Highlights: Nothing new, no ceasefire announcement, threats to Iran, Hormuz reopening responsibility on countries importing through it, 2-3 weeks more of kinetic action, no off ramp, no talk of ground troops action. Markets disappointed as the same messaging was rehashed after building up expectations of a very significant announcement. US futures down, Indian futures down, Oil back at 105$.”

Another market expert Vivek Karwa said the street has taken the speech negatively, suggesting that the uncertainty is far from over.

He added, “This shows that yesterday’s was just value buying and war is not over and what is continuing in the market is going to continue. What should investors do now? We are back to square one. The volatility is going to continue. While Trump was speaking, we saw Brent and WTI crude almost touching 103 and 105 (dollars). So, the crude oil is again going to go up. Until there is clarity that the war is going to get over, war is not going to react positively.”

The reaction was also visible in global commodity markets. Crude oil prices moved higher during the speech, adding pressure on equities, especially for an import-heavy economy like India.

Despite a recent gap-up opening, analysts say the near-term trend remains fragile, with key levels now under watch.

Shrikant Chouhan, Head Equity Research at Kotak Securities, said, “For traders, 22,500/72500 and 22,250/72000 would act as key support zones. As long as the market trades above these levels, the pullback move could continue upwards, with 22,900-23,000/73800-74200 acting as immediate resistance zones for bulls. Below 22250/72000, it could fall to 22100-22000/71500-71200.”