Indian Stock Market Plunges Amid Escalating Indo-Pak Tensions
On Friday, May 9, 2025, Indian equity markets experienced a significant downturn, driven by escalating geopolitical tensions between India and Pakistan. The benchmark BSE Sensex tumbled 880 points, or 1.10%, to close at 79,454.47, while the NSE Nifty 50 declined by 266 points, settling at 24,008.
Investor sentiment was dampened following reports of intensified military engagements along the border, prompting widespread sell-offs across various sectors. The financial services sector bore the brunt, with ICICI Bank shares dropping 3.24%, marking it as one of the day’s top losers. Other significant decliners included Power Grid Corporation and Grasim Industries, which fell by 2.74% and 2.22%, respectively.
Despite the overall market decline, certain stocks demonstrated resilience. Titan Company led the gainers with a 4.17% increase, followed by Larsen & Toubro and Tata Motors, which rose by 3.84% and 3.83%, respectively.
Sector-wise, the Nifty Bank and Financial Services indices suffered significant losses of 1.42% and 1.84%, respectively. The Nifty Realty index emerged as the top sectoral loser, declining by 2.38%. Conversely, the Nifty PSU Bank index bucked the trend, gaining 1.59%, while the Consumer Durables and Media indices each advanced nearly 1%.
The broader market also reflected the bearish sentiment, with the BSE Midcap and Smallcap indices declining by 0.10% and 0.30%, respectively. Market breadth was negative, as 1,738 stocks declined compared to 1,065 advances on the NSE. Additionally, approximately 190 stocks hit their 52-week lows during the session.
The heightened geopolitical tensions also impacted currency markets. The Indian rupee experienced its worst single-day decline in over two years, falling sharply amid the escalating conflict. The Reserve Bank of India intervened by selling U.S. dollars through state-run banks to stabilize the currency, which had dipped to a session low of 85.8425 before rebounding to 85.50.
Analysts caution that continued geopolitical instability could further weigh on market performance in the coming weeks. Investors are advised to monitor developments closely and consider risk mitigation strategies to navigate the uncertain landscape.