Sensex Posts Largest Weekly Decline Since May 2020 Amid Middle East Conflict

Market Update: Indian Indices Witness Worst Weekly Drop Since May 2020

The Sensex, India's benchmark index, declined by 5.5% this week, marking its worst weekly drop since May 2020. This decline was largely driven by the ongoing war in the Middle East, which has pushed crude oil prices above $100 a barrel. As a result, inflation and growth concerns have escalated for India.

The Nifty 50 also dropped 5.3% this week, with all 16 major sectors logging losses. The broader market, comprising mid-caps and small-caps, fared worse, with declines of 4.6% and 3.7%, respectively. The auto sector was the biggest laggard, plummeting 10.6%, its steepest weekly drop in six years, driven by fears of production and export disruptions.

Financial heavyweights also suffered, declining 5.7% due to intensifying foreign investor outflows. However, Coal India bucked the trend, surging 6% as early summer prospects raised demand expectations.

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On March 13, markets closed lower for the third consecutive week, amidst escalating Middle East tensions. A total of 45 Nifty stocks reported negative returns, with 24 of them falling between 5-12%. Top losers among the Nifty constituents included L&T, M&M, UltraTech Cement, Eicher Motors, and Maruti Suzuki. Mid-cap losers included Polycab, IDBI Bank, MRPL, and Bharat Forge.