Indices fall 2.5%, Nifty likely in ‘ bear grip’

In line with the correction since February 28, 2026, benchmark stock indices fell 2.5% on Monday owing to concerns over the ongoing West Asia conflict which has spiked crude prices, fuelling fears of high inflation.

U.S. President Donald Trump’s ultimatum to Iran had rattled most Asian markets and India was no exception. The sale by foreign portfolio investors also added to the pressure.

The BSE Sensex fell 2.46%, to 72,696 points. Mirroring the same sentiment, NSE Nifty 50 shed 600 points, or 2.6%, to 22,513 points, its lowest level since April 9, 2025.

Vinay Rajani, Senior Technical Research Analyst, HDFC Securities, said the 600 points fall signals “deeper Bear mauling”.

“Nifty 50 opened 300 points lower and extended losses throughout the session, closing near the day’s low after registering a steep 15% correction from its all-time high of 26,373, now marching towards its 52-week low of 21,743,” he said.

NSE cash volumes dipped marginally by 7% from the prior session, with HCL Tech, Power Grid, and ONGC emerging as the sole Nifty 50 gainers amid a sea of red; Titan, Shriram Finance, and Trent spearheaded the losses.

All sectoral indices closed lower, hammered by brutal declines in consumer durables, metals, realty, financial services, and PSU banks. 

Hariprasad K., SEBI-registered Research Analyst and Founder, Livelong Wealth, said, “The intensity of the decline indicates that the recent fragility in global cues has now translated into broad-based selling pressure across domestic markets.”

“The ongoing West Asia conflict has intensified inflation fears, especially through elevated crude oil prices, which directly impact input costs and global growth expectations. At the same time, a strengthening U.S. dollar and rising Treasury yields have reduced the appeal of commodities, triggering liquidation across metal stocks. This suggests that the current correction is not merely technical, but a deeper repricing of global risk,” he added.

On Monday, midcaps and smallcaps bore the brunt of the rout, with Nifty Midcap 100 tumbling 3.9% and Nifty Smallcap 100 falling 3.94%, while market breadth cratered with the BSE advance-decline ratio shriveling to a dismal 0.16.

“Nifty remains firmly in the bear grip, with every intraday recovery savagely sold off, particularly after breaching key support at 22,930,” Mr. Rajani said. 

The Indian rupee on Monday hit a record intraday low of 94.11 against the U.S. dollar battered by fears of an escalating West Asia conflict that amplified the sell-off across Indian assets.

Believed to be supported by the Reserve Bank of India (RBI), which sold dollar in the market to arrest the excess volatility, the Rupee stabilised at 93.53 against the previous close of 93.53, closing flat on the Clearing Corporation of India Ltd. spot market. 

Anindya Banerjee, Head of Commodity and Currency Research, Kotak Securities said, “The rupee is currently a hostage to developments around the Strait of Hormuz, with elevated energy prices driving a dollar liquidity squeeze and keeping pressure on emerging market currencies. As long as disruptions persist over the next 2–3 weeks into mid-April, USD-INR could test the 96–97 zone in a worst-case scenario, with 95 and 96 acting as key resistance levels.”

“However, this is largely a liquidity-driven move rather than a structural shift, and any easing in geopolitical tensions could trigger a sharp correction in energy prices and a relief rally in the rupee. In this uncertain, binary environment, importers should prefer option-based hedging for flexibility, while exporters can utilise spikes toward 95–96 and above to build forward hedges for the April–June quarter,” he added.

Published – March 23, 2026 08:51 pm IST