Nifty Drops Over 100 Points Amid Renewed US-Iran Tensions and Higher Crude Prices

Global Tensions Weigh on Indian Markets

Indian markets are poised to open lower on Friday, with the GIFT Nifty trading down 125 points or 0.51 percent at 24,274 in early trade, amid renewed geopolitical tensions between the US and Iran. Rising crude oil prices have also contributed to the decline, with Brent crude rising over 2 percent to above $102 per barrel in Asian trade, while US crude climbed to around $96.8 a barrel.

The fall in GIFT Nifty indicates a weak start for benchmark indices Sensex and Nifty amid softer global cues. This cautious indication comes after domestic markets ended marginally lower in a volatile session on Thursday, with the Nifty managing to hold above the 24,300 mark on hopes of easing geopolitical tensions following reports of a possible US-Iran peace deal.

However, sentiment weakened again overnight after fresh clashes between the US and Iran raised concerns over the durability of the ceasefire and the reopening of the Strait of Hormuz, a critical global oil transit route. Crude oil prices rebounded sharply after three consecutive sessions of decline, with Brent crude surging more than 3 percent earlier in the session.

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Global Markets React to Renewed Tensions

Asian equities pulled back from record highs following the renewed tensions, with the MSCI Asia Pacific Index declining 0.9 percent in early trade. US stock-index futures turned flat after initial weakness, while Japanese equities are expected to open slightly lower after Thursday's record rally.

Wall Street ended lower overnight, with investors booking profits in technology and chip stocks after the recent AI-led rally. The S&P 500 fell 0.38 percent to 7,337.11, the Nasdaq slipped 0.13 percent to 25,806.20, while the Dow Jones Industrial Average declined 0.63 percent to 49,596.97.

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Institutional Flows Remain Mixed

Back home, institutional flows remained mixed. Foreign institutional investors continued to remain net sellers on Thursday, though the pace of selling eased sharply, with outflows of Rs 340 crore. Domestic institutional investors remained supportive and bought equities worth Rs 441 crore.

According to Ponmudi R, CEO of Enrich Money, Indian markets are expected to remain cautious and highly sensitive to geopolitical developments. He added that the latest exchange of fire between the US and Iran near the Strait of Hormuz has reinforced uncertainty and weakened risk appetite despite intermittent diplomatic signals.

Aakash Shah, Technical Research Analyst at Choice Equity Broking, said GIFT Nifty indicated a cautious negative start amid renewed Iran-US tensions and mixed Asian markets. According to him, the broader undertone for Nifty remains positive as long as it holds above the crucial 24,200-24,000 support zone.

Option data also points to strong support near the 24,000 strike, while resistance remains concentrated in the 24,400-24,500 zone due to active call writing, he added.