Indian shares tumbled for the second consecutive session on Friday. Investors pulled out heavily amid rising military tension between India and Pakistan. The total market value plunged by nearly $83 billion.
The fall followed intensified cross-border attacks. The conflict began on Wednesday when India struck several “terrorist infrastructure” sites in Pakistan. The move came in response to a deadly attack in Indian-administered Kashmir last month. Pakistan responded with its own military strikes, triggering fears of a prolonged conflict.
Indices Lose Ground but Hold Key Levels
The Nifty 50 index dropped 1.1% but closed above the key 24,000 mark. Meanwhile, the BSE Sensex also fell 1.1% and ended below the 80,000 level it held on Thursday. At one point, markets were on track to lose up to $108 billion.
Markets had already slipped 0.5% on Thursday. For the week, both indices have lost about 1.3%, breaking a three-week winning streak—their longest run of gains in 2025.
Investors Grow Anxious Over Escalation
Avinash Gorakshaka, head of research at Profitmart Securities, said investors are uneasy. “With so much escalation, domestic markets are jittery because further retaliatory measures from Pakistan could lead to a prolonged, full-fledged conflict,” he warned.
He added that fundamentals will now take a back seat. “Sentiment, influenced by updates from the conflict, could derail market momentum at least for a week if the fighting continues.”
Volatility Spikes; Rupee Weakens
India’s volatility index, known as the ‘fear gauge’, surged for the eighth straight session. It hit a one-month high. The central bank also stepped in to support the weakening rupee, which came under pressure due to the geopolitical situation.
Broad Sell-off Across Sectors
Twelve of the 13 major sectors ended the week in the red. Small-cap stocks dropped 1.9%, while mid-caps slipped 0.8%. The sell-off was widespread, driven by fear of prolonged unrest.
Auto Stocks Shine Amid Gloom
Amid the gloom, the auto sector offered a silver lining. Tata Motors surged 8.7% this week. Analysts linked the rise to hopes that a UK-US trade agreement would benefit Tata’s British arm, Jaguar Land Rover (JLR). The company topped the list of gainers among the 11 Nifty 50 members that closed the week higher.
Traders Eye Economic Resilience, US-India Trade Talks
Despite the decline, analysts believe the Indian market still has strong underpinnings. Hopes of a U.S.-India trade deal and confidence in the country’s economic resilience are expected to draw traders back.
The ongoing military conflict, however, remains a serious overhang.
Summary
-
Indian shares fell for a second straight day, losing $83 billion in value.
-
The Nifty 50 and BSE Sensex both declined by 1.1%.
-
Cross-border attacks between India and Pakistan sparked investor fear.
-
Volatility soared, and the rupee weakened.
-
Most sectors dropped; small- and mid-cap stocks suffered.
-
Tata Motors jumped 8.7%, giving auto stocks a lift.
-
Traders remain hopeful about a US-India trade deal.
If the geopolitical situation worsens, further market losses are likely. However, strong fundamentals could cushion the blow in the long run.
Follow us on Google News, Instagram, YouTube, Facebook,Whats App, and TikTok for latest updates
