Bearish Risk: Nifty, Sensex Face Volatility Amid US-Iran Tensions

The Indian stock market concluded the week with experts anticipating continued volatility in the upcoming trading sessions. This outlook is primarily driven by the escalating geopolitical tensions between the US and Iran, which historically lead to increased global risk aversion and impact emerging markets like India.

This matters significantly for traders as geopolitical events can trigger sharp market corrections, FII outflows, and currency depreciation. The uncertainty surrounding the US-Iran conflict could lead to higher crude oil prices, impacting India's import bill and inflation, thereby influencing RBI's monetary policy decisions and corporate earnings.

Benchmark indices like NIFTY and SENSEX are likely to experience downward pressure and increased volatility. Oil & Gas companies could see mixed impacts; upstream players might benefit from higher crude prices, while downstream and oil marketing companies (OMCs) could face margin pressure. Safe-haven assets like gold and silver, and related ETFs, are expected to see positive momentum.

Traders should closely monitor developments in the US-Iran conflict, global crude oil prices (especially Brent crude), and the INR-USD exchange rate. Key support levels for Nifty 50 and Sensex should be watched for potential breakdowns, and any signs of de-escalation could provide a relief rally.

• •Indian indices ended the week on Friday.
• •Experts commented on the likely performance of the stock market in the coming week.
• •The outlook is influenced by ongoing geopolitical tension, specifically the US-Iran war.
• •Risk flag: Sharp escalation in US-Iran conflict
• •Risk flag: Sustained rise in Brent crude prices above $90/barrel