Equity Alert
Nifty 50 may drop to 25000 pts as oil spikes on US-Iran war
This story was originally published at 08:43 IST on 2 March 2026
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Equity Alert: Nifty 50 may drop to 25000 pts as oil spikes on US-Iran war
MUMBAI--0750 IST--Benchmark equity indices are expected to open sharply lower Monday after oil prices spiked as US-Iran tensions turned into a full-fledged war over the weekend. Other Asian markets already witnessed a fall at open, with indices in Hong Kong, Japan, South Korea, Taiwan, and Singapore down 1-3%. Futures contracts of Dow Jones Industrial Average were down 0.6%, indicating a fall in the US market when trading begins later in the West.
The US and Israel attacked Iran over the weekend killing Iran's supreme leader Ayatollah Ali Hosseini Khamenei. Iran retaliated on Sunday and launched missiles against Israel and other Gulf countries, killing three US soldiers in Kuwait, reported the New York Times. Iran also shut the Strait of Hormuz, a narrow waterway that connects the Persian Gulf to the Indian Ocean, which is used in transporting a fifth of global crude oil flows. Brent crude oil futures jumped nearly 14% at open Monday, crossing $82 per barrel. Prices have since come off highs, but it was still up over 4% at $76 per barrel, at 0746 IST.
Technical analysts predict the Nifty 50 is likely to fall to 25000-25100 points initially when the market opens for trading and may even fall to 24800 points till the end of day if selling persists. However, GIFT Nifty contracts are not pointing towards a fall in the Nifty 50. The March contracts of the Nifty 50, traded on the NSE International Exchange, fell below 25000 points at open but quickly came off lows. At 0734 IST, the contracts were at 25182 points, indicating a a flat opening.
While the GIFT Nifty contracts are indicating a muted reaction by markets, the index could fall if the war lasts for more than a week as a sustained rise in crude oil price could hit earnings, analysts said. "Expect a significant correction - Nifty, in our view, could again test 24500-25000 levels, and even go lower if the conflict lasts more than 1-2 weeks. If the hostilities end within a week or so, the market should revive just as quickly," Seshadri Sen, head of research and strategist, said in a strategy report Monday.
Shares of oil-sensitive sectors such as oil marketing companies, paints, tyres, aviation, and chemicals are likely to fall, while oil exploration companies may rise. Defence companies may also rise but JM Financial Insitutional Equities said the rise might be just sentimental. (Anshul Choudhary)
Equity Alert: US stock futures drop after attack on Iran; crude prices surge
MUMBAI--0730 IST--Futures contracts of US benchmark indices slumped after the US, in co-ordination with Israel, conducted joint military operations against Iran over the weekend. This action resulted in the death of Iran's Supreme Leader, Ayatollah Ali Khamenei, reports confirmed. These operations have raised concerns over the operability of the Hormuz Strait, a major crude oil chokepoint, resulting in a surge in crude oil prices.
At 0721 IST, the March contract of the E-mini Nasdaq-100 futures was down 0.5% at 24884 points. The E-Mini Dow Future contract was down 0.6% at 48712 points.
"The tail risk of a sustained conflict is higher than in 2024 or 2025, though we don't see this war escalating to a point where it drastically changes the US outlook," CNBC quoted Ajay Rajadhyaksha from Barclays as saying. But in the first half of this week, "it is too early to buy any dip, especially with investors used to a pattern of quick de-escalation," he said.
Earlier on Monday, the May futures contract of Brent crude oil rose to an over one-year high of $82.37 per barrel. At 0721 IST, the contracts were up 5% at $76.19 per barrel. The oil market's trajectory depends on whether the fighting disrupts shipments through the Strait of Hormuz and a sustained interruption there could reverberate through global energy markets and reignite inflation pressures, CNBC said.
On Friday, benchmark indices in the US had closed lower, dragged down by financial services and technology stocks. The sell-off was driven by uncertainty over costs and disruption related to artificial intelligence, revived tariff uncertainties, and simmering geopolitical tensions, Reuters reported.
On the macroeconomic front, a hotter-than-expected Producer Price Index reading cut expectations of the US Federal Reserve cutting its key interest rate in the near term. Headline producer inflation came in at 2.9%, as opposed to 2.6% expected by the Street. Markets are currently pricing in a 95.6% probability that the central bank will leave the US Fed funds target rate in the 3.50-3.75% range at its upcoming monetary policy meeting in March, according to CME's FedWatch tool.
Following are the closing levels of US indices Friday:
| Index | Level | Change in % |
| S&P 500 | 6878.88 | (-)0.43 |
| NASDAQ Composite | 22668.21 | (-)0.92 |
| Dow Jones Industrial Average | 48977.92 | (-)1.05 |
(Eshitva Prakash)
US$1 = INR 90.975
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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