Weak Opening Of Indian Indices Amid Global Tensions

Indian equities opened sharply lower on March 2 as global risk-off sentiment intensified.

Gift Nifty at 25,205 had already signalled a gap-down start of around 150 points for the Nifty. When trading began, the weakness was clear. The Sensex fell 1,123.92 points, or 1.38% to 80,163.27, while the Nifty slipped 331.60 points, or 1.32% to 24,847.05.

Market breadth was firmly negative. About 363 shares advanced, while 2,551 declined. Interglobe Aviation, L&T, Maruti Suzuki, Asian Paints, and Tata Motors Passenger Vehicles Limited (TMPV) were among the major losers on the Nifty. ONGC, Bharat Electronics, and Hindalco managed to buck the trend.

Oil Prices Rise As Supply Concerns Grow

The pressure was not limited to India. Other Asian markets opened nearly 1.1% lower, reflecting unease after US and Israeli strikes on Iran over the weekend.

Oil prices reacted immediately. Brent crude surged as much as 17% to $82.40 per barrel, its highest level since January 2025. US West Texas Intermediate crude climbed to $71.68 per barrel after touching $75.33 earlier in the session.

Tehran has said it has closed navigation through the Strait of Hormuz, a route that carries nearly 20% of global oil flows. For India, the risk is significant. Over 40% of India's crude oil flows through this single channel. With volatility in West Asia, governments and refineries are starting to worry about their backup supplies. This sudden instability has spooked the global markets, causing investors to pull their money out of the equity markets and into safe-haven assets.

As a result, gold prices also rose nearly 2%, with spot gold hitting $5,368 per ounce, signalling a shift towards safe-haven assets.

Why Are IT And Cyclical Stocks Under Pressure?

Friday had already marked the third straight monthly loss for benchmark indices. February was particularly painful for technology stocks, which logged their worst monthly performance since September 2008.

Concerns are building that artificial intelligence could disrupt earnings growth in the software sector. Geopolitical tensions have unsettled markets, while Anthropic’s latest AI plugin releases triggered a sharp selloff in domestic IT stocks.

Selling has been broad-based. Cyclicals, rate-sensitive banks, realty and consumption-linked stocks have all been weak. Metals have shown some resilience, but defensives have not attracted strong safe-haven flows, underlining the depth of caution.

Can Domestic Flows Cushion The Fall?

Institutional data shows a split trend. On a month-to-date basis, foreign institutional investors bought shares worth ₹51,307.56 crore and sold ₹62,309.91 crore, resulting in a net outflow of ₹11,002.35 crore.

Domestic institutional investors, however, have provided support. They bought ₹44,110.44 crore and sold ₹26,786.06 crore, leading to a net inflow of ₹17,324.38 crore.

On February 27, foreign investors recorded a net outflow of ₹7,536.36 crore, while domestic institutions posted a net inflow of ₹12,292.81 crore. A day earlier, foreign investors sold a net ₹3,465.99 crore, even as domestic institutions bought a net ₹5,031.57 crore.

The pattern is clear. Foreign money has been cautious, while domestic players have stepped in to absorb supply.

Also Read - GST Collections Rise 8.1% To ₹1.83 Lakh Crore In February

What’s Ahead?

Still, with oil prices climbing, tensions escalating, and technical indicators turning weak, traders are bracing for volatility. Strong domestic economic data, such as GDP growth and GST collections, could help in recovery, but much will depend on crude supply and further developments in West Asia. Watch out for the rise in prices of safe-haven assets as this uncertainty continues.

Sources:

India Today

Moneycontrol

Economic Times

Business Line