Midday Market Update: Nifty and Sensex Dip Amid Global Tensions; Auto Stocks Lead Gains

As of 12:26 p.m. IST, the Nifty 50 was down 0.25 per cent at 24,792, while the Sensex fell 0.2 per cent to reach 81,424.20.

Market Update at 12:30 PM: Indian equities managed to recover from early declines on Wednesday, supported by strong domestic liquidity and bargain buying, despite weak cues from global markets due to rising geopolitical tensions and economic concerns.

As of 12:26 p.m. IST, the Nifty 50 was down 0.25 per cent at 24,792, while the Sensex fell 0.2 per cent to reach 81,424.20. Earlier in the session, both indices had slipped nearly 0.3 per cent.

The rally was broad-based, with eight out of thirteen sectoral indices posting gains. The auto sector led with a 1.1 per cent rise, while Small-Cap and Mid-Cap indices remained largely unchanged..

Meanwhile, crude oil prices continued to rise as the Israel-Iran conflict entered its sixth day, stoking fears of a wider regional crisis. Being a major oil importer, India remains exposed to higher energy costs, which could impact inflation and the trade deficit.

Investor sentiment also remained cautious ahead of the U.S. Federal Reserve’s policy announcement later in the day. While no rate change is expected, markets will closely watch the Fed’s updated economic outlook for future guidance.

Among individual stocks, IndusInd Bank jumped 5.1 per cent, citing a substantial clean-up of the bank’s balance sheet. On the other hand, BSE Ltd declined 1.5 per cent amid concerns that the recent shift in equity derivatives expiry day could hurt its market share.

Market Update at 10:30 AM: Indian equity benchmark indices started Wednesday's session on a negative note, impacted by rising tensions in the Middle East that pushed oil prices higher and dampened investor confidence.

As of 9:15 a.m. IST, the Nifty 50 slipped 0.26 per cent to 24,788.35, while the BSE Sensex was down 0.33 per cent at 81,314.62.

At market open, 11 out of 13 key sectoral indices were trading in the red. Broader indices also mirrored the weakness, with the small-cap and mid-cap indexes each edging lower by about 0.1 per cent.

U.S. markets closed lower overnight, and crude oil prices climbed as the Israel-Iran conflict entered its sixth day, increasing fears of a broader regional escalation in the oil-sensitive Middle East.

Higher crude prices remain a concern for countries like India, where oil imports form a significant part of the trade basket.

Pre-Market Update at 8:00 AM: Indian equity benchmarks, Sensex and Nifty 50, are expected to start Wednesday's session on a muted note as mixed signals from global markets and ongoing geopolitical tensions, especially the Israel-Iran conflict, weigh on investor sentiment.

Asian markets traded in the red, while U.S. indices edged lower overnight as investors awaited the Federal Reserve's interest rate decision, scheduled for later today in the U.S.

Back home, the domestic markets ended lower on Tuesday amid profit-booking in heavyweight stocks such as HDFC Bank, Reliance Industries, and Bajaj Finance. Weak global cues further dampened sentiment. The Sensex declined by 213 points (0.26 per cent) to close at 81,583.30, while the Nifty 50 ended the day 93 points lower (0.37 per cent) at 24,853.40.

Equity markets across Asia were mostly negative, with rising tensions in the Middle East impacting sentiment. Japan’s Nikkei 225 slipped 0.15 per cent, and the Topix index declined 0.18 per cent. In South Korea, the Kospi dropped 0.44 per cent, while the Kosdaq was down 0.15 per cent. Hong Kong’s Hang Seng futures indicated a weaker start around 23,813, lower than the last close of 23,980.30.

Gift Nifty was hovering near 24,834, roughly 29 points lower than Tuesday’s Nifty futures close, suggesting a subdued open for Indian indices.

On Tuesday, all three key U.S. indices ended in the red. The Dow Jones shed 299.29 points (0.70 per cent) to finish at 42,215.80. The S&P 500 declined 0.84 per cent to 5,982.72, while the Nasdaq Composite fell 0.91 per cent, closing at 19,521.09. Traders remained cautious ahead of the Federal Reserve’s policy outcome.

On Tuesday, June 17, Foreign Institutional Investors (FIIs) were net buyers, having bought equities worth Rs 1,616.19 crore. Domestic Institutional Investors (DIIs), on the other hand, bought shares totalling Rs 7,796.57 crore during the same session.

The conflict between Israel and Iran intensified overnight, prompting the U.S. to boost its military presence in the region. President Donald Trump held a high-level meeting with his national security advisors to assess the situation, although no immediate details were shared. The escalation has triggered concerns over broader instability in the Middle East.

Oil prices continued their upward movement, building on Tuesday’s 4 per cent rally. As of early Wednesday, Brent crude rose 19 cents (0.25 per cent) to  USD76.64 per barrel, and WTI crude was up 23 cents (0.31 per cent) to  USD75.07 per barrel, as markets priced in possible supply disruptions due to geopolitical risks.

Gold prices inched higher as investors sought safe-haven assets amid the Iran-Israel conflict. Spot gold was up 0.2 per cent at  USD3,390.59 an ounce, although U.S. gold futures ended 0.3 per cent lower at  USD3,406.90. Meanwhile, silver surged to its highest level in over a decade.

The U.S. dollar reversed early losses, strengthening against the yen, buoyed by data indicating cautious consumer behavior in the U.S. ahead of the Fed decision.

For today, IREDA, CDSL, ABFRL, Chambal Fertilisers, Hudco, RBL Bank, Titagarh and Birlasoft continue to remain under the F&O ban list.

Disclaimer: The article is for informational purposes only and not investment advice.