US-Iran Tensions Trigger 75 Stocks in Nifty 500 to Enter Bear Market

Global Market Volatility: Escalating Conflict Triggers Sharp Decline in Indian Stock Market

The ongoing conflict between the United States, Israel, and Iran has sent shockwaves through the global stock market, with India's Nifty 50 index experiencing a sharp 3.6% decline since the beginning of the war. The broader Nifty 500 index has slumped almost 4%, with 75 stocks crashing 10% or more in just 5 sessions.

Key sectors impacted by the rising crude oil prices include energy companies like OMCs (Oil Marketing Companies), city gas distributors, aviation, chemicals, cement, tyres, and logistics. OMCs such as BPCL, IOCL, and HPCL have seen a decline of 13-14% each, as crude oil prices form a key input component and any jump in prices can erode their margins.

According to JM Financial estimates, every $1/bbl higher oil price above $70/bbl hits OMCs auto-fuel GMM by ₹0.55/ltr and consolidated EBITDA by 7-9%. The recent conflict had pushed oil prices briefly above $115/barrel, after which they cooled off but remain high at above the $90 level.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Stocks like GAIL (India), PG Electroplast, and Mahanagar Gas have also faced steep losses, shedding over 10% each as they suffered from gas supply shortages. India's major liquefied natural gas (LNG) supplier, Qatar, was impacted by a drone strike on its facilities, with nearly half of its LNG imports last year coming from the Gulf nation.

The Indian government has invoked emergency powers to ensure that there is no shortage of LPG for domestic consumers, amid supply concerns arising from escalating geopolitical tensions in West Asia. Several large-cap names like Tata Motors PV, L&T, UltraTech Cement, and Bosch were also significantly hit, each shedding over 10%.