Stock market today: A day after logging strong gains of more than 1% each, domestic market benchmarks, the Sensex and the Nifty 50, resumed their downward March on Friday, March 6, due to profit booking amid persisting concerns over the US-Iran war, crude oil price spike, and heavy foreign capital outflow.
The Senex crashed 1,097 points, or 1.4%, to end at 78,918.90, while the Nifty 50 fell to 24,450.45, losing 315 points, or 1.3%. The mid and small-cap segments, however, outperformed despite ending in the red. The BSE 150 MidCap Index dropped 0.67%, while the BSE 250 SmallCap Index slipped 0.22%.
The overall market capitalization of BSE-listed firms slipped to ₹450 lakh crore from ₹453 lakh crore in the previous session, resulting in a loss of ₹3 lakh crore for investors in a single session.
Why did the Indian stock market fall?
1. The ongoing US-Iran war
The market’s rise in the previous session was more of a short-covering rally after the recent fall, amid reports that Iran was making conditional offers to the US. Later, some media reports claimed that Tehran had made no offer to Washington, raising concerns that the US-Iran war could last longer.
The combined attack of the US and Israel on Iran entered its seventh day on Friday. US President Donald Trump has reportedly said he has no time limits for ending the war.
2. Oil prices remain elevated
Brent Crude eased slightly on Friday but continued trading near $85 per barrel mark, keeping investors worried about its impact on India’s fiscal health, inflation trajectory and monetary easing cycle.
For India, which imports more than 90% of its crude oil, every $1 increase in the price of a barrel of crude oil raises the country’s import bill by around ₹16,000 crore, according to economists.
Global brokerage Morgan Stanley has downgraded the Indian stock market to equal weight in its latest reshuffle, highlighting that the conflict in the Middle East could disrupt supply chains if oil flows through the Strait of Hormuz fail to recover.
Meanwhile, on Friday, US Treasury Secretary Scott Bessent said Washington would allow a 30-day waiver for Indian refiners to purchase Russian oil stranded at sea.
3. Aggressive FII selling
In just three sessions of March, foreign institutional investors (FIIs) have sold off Indian stocks worth ₹15,800 crore in the cash segment. This is the ninth consecutive month FIIs have been selling Indian stocks in the cash segment. The US-Iran war, jump in crude oil prices, and currency fluctuations have aggravated their sales in the Indian market.
4. Growth outlook takes a hit
The rapidly changing geopolitical and geoeconomic situation has raised concerns that India’s resilient growth story is at risk. While the Indian stock market has been delivering weak earnings for over a year now, the country’s healthy growth outlook has been a ray of hope for an earnings revival. That hope is weakening now.
According to brokerage firm Motilal Oswal Financial Services, the Nifty delivered a 7% YoY PAT growth in the December quarter of the financial year 2026. The brokerage firm underlined that Nifty reported a single-digit earnings growth for the seventh consecutive quarter since the pandemic (June 2020).
According to a PTI report, Moody’s Ratings believes the Indian rupee could come under pressure amid rising inflation, and the current account deficit may widen if the escalating Middle East conflict spikes energy prices and disrupts supplies.
5. Selling in banking, financial majors
Selling in banking and financial heavyweights weighed on the benchmarks as they have significant weight in the key indices.
Major banking and financial stocks, including ICICI Bank, HDFC Bank, Axis Bank, and SBI, declined 2-3%. The Nifty Bank, Financial Services, PSU Bank, and Private Bank indices crashed more than 2% each on Friday.
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Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
