Intensifying West Asia war pulls sensex down 1.3k points

MUMBAI: As the prospect of a quick end to the war in West Asia thinned, sensex reversed with a 1,342-point slide on Wednesday to close at 76,864 points. The index is now down more than 10% from its all-time high of 86,159 points recorded intraday on Dec 1, 2025. Since the war between the US-Israel and Iran started on Feb 28, the index has lost 5.4%.

On Wednesday, the sensex opened slightly higher but selling started almost from the word go and through the session it slid to an intra-day low at 76,759 points. It closed just a tad above that mark, down 1.7% on the day. On the NSE, Nifty too took a similar path to close 395 points (1.6%) down at 23,867 points.

The day’s session left investors poorer by a little over Rs 5 lakh crore with BSE’s market capitalisation now at Rs 441.9 lakh crore.

Investors are now jittery from the rise in crude prices that nearly touched a high of $90/barrel again during the day. On Tuesday when there was some optimism about the end to the war—after a press conference by the US President Donald Trump where he hinted at a non-conflict solution to the issue—crude prices had crashed over 20% to below the $80 mark.

Market players and investors also were nervous as the rupee again weakened below the 92-per-dollar mark, after trading in the sub-92 level on Tuesday. Strong selling by foreign funds also weighed on the rupee, analysts and traders said. On Wednesday, foreign portfolio investors recorded a net outflow of Rs 6,267 crore from stocks, BSE data showed.

According to Siddhartha Khemka, Head of Research - Wealth Management, Motilal Oswal Financial Services, Indian equities are likely to remain volatile driven by developments in the West Asia conflict, sharp movements in crude oil prices and continuous foreign fund outflows.

“On Wednesday, markets resumed their downward trajectory after a brief rebound in the previous session, (due to) persistent foreign fund outflows,” Khemka said.

“The decline was further aggravated by heightened geopolitical tensions in West Asia after the US and Israel launched some of their heaviest strikes on Iran, keeping investors cautious even as the US signaled the possibility of de-escalation. Investor sentiments may remain fragile as geopolitical tensions continue to weigh on global risk appetite.”

Among the 30 sensex stocks, 27 closed in the red, while three—NTPC, Sun Pharma and Power Grid—closed higher. HDFC Bank, Axis Bank and ICICI Bank contributed the most to the day’s slide in the index, BSE data showed.

In the broader market, there were 2,423 stocks that closed in the red while 1,850 closed with gains.

Around the world, trading was mixed. Nikkei in Japan closed 1.4% up and Shanghai in China closed marginally up while Hang Seng in Hong Kong closed marginally down. In late-session in Europe, FTSE in the UK was down 0.6% while Dax in Germany was deep in the red, down 1.4%. Across the Atlantic, in mid-session, Dow Jones index was down 0.7%, Nasdaq was up marginally while S& was down marginally.