The Indian stock market declined for the fourth consecutive session on Thursday, July 23, with the Nifty 50 closing at 23,869.60, down 127 points or 0.53%. The BSE Sensex fell 364 points, or 0.47%, to end at 76,391.39. This drop came amid rising crude oil prices, which reached nearly $99 per barrel, exacerbated by escalating tensions in the Middle East.
Key Details
Investor sentiment remained fragile as the overall market capitalization of BSE-listed firms fell by over ₹3 lakh crore in a single day, decreasing from ₹480 lakh crore to below ₹477 lakh crore. The Nifty Midcap 100 and Nifty Smallcap 100 indices also experienced significant declines, each dropping more than 1%. Analysts noted that the sustained rise in oil prices raises concerns over inflation and could lead to monetary tightening in India.
The market's downturn was further influenced by the ongoing conflict involving Iran, with missile strikes continuing for the 12th consecutive night. Reports indicated that Iranian-backed forces attacked Saudi oil tankers, raising fears of broader supply disruptions. The rupee also weakened, closing at 96.57 per dollar, down 4 paise, and marking a decline of over 2% against the dollar for the month.
Background
Market analysts suggest that the Nifty 50 has entered a consolidation phase, slipping below the psychologically significant 24,000 level. Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities, stated that the index is likely to remain range-bound unless new market triggers emerge.
The ongoing rise in oil prices is likely to pressure inflation and could lead to adjustments in monetary policy, impacting sectors sensitive to fuel costs. Investors will watch for further developments in the Middle East and any potential shifts in crude oil prices that could influence market direction.