Sensex, Nifty end sharply lower amid Middle East tensions and risk-off mood

The headline equity benchmarks ended sharply lower on Monday, extending losses for a fourth straight session. Sentiment was hit by escalating tensions between the US and Iran, a surge in crude oil prices amid concerns over potential disruptions in the Strait of Hormuz, continued foreign institutional investor (FII) selling, and rising US bond yields. Broader markets also came under pressure, with the midcap and smallcap indices declining around 1% each. The Nifty settled below the 23,400 mark. FMCG stocks led the decline, while IT shares bucked the trend on buying interest. Analysts said the Nifty has re-entered a consolidation phase, with immediate support seen at 23,430-23,450 and resistance at 23,670-23,690.

The S&P BSE Sensex dropped 508.40 points or 0.68% to 74,267.34. The Nifty 50 index fell 165.15 points or 0.70% to 23,382.60. In four consecutive trading sessions, the Sensex tanked 2.90% while the Nifty fell 2.70%.

ITC (down 2.53%), Larsen & Toubro (down 1.61%) and ICICI Bank (down 1.33%) were major index drags today.

The broader market underperformed the frontline indices. The BSE 150 MidCap Index tumbled 1.43% and the BSE 250 SmallCap Index slumped 0.87%.

The market breadth was weak. On the BSE, 1,589 shares rose and 2,761 shares fell. A total of 207 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, rose 2.20% to 16.54.

Economy:

India's manufacturing sector recorded stronger growth in May, with final figures surpassing earlier flash estimates. The HSBC India Manufacturing PMI rose to 55.0, up from 54.7 in April and the flash reading of 54.3, marking the best improvement in three months.

India's Gross GST collections rose 3.2% to over Rs 1.94 lakh crore in May on improved supplies of goods and services, and continued expansion of collection from imports, government data showed on Monday. Gross GST collection stood at Rs 1.88 lakh crore in May, 2025.

Numbers to Track:

The yield on India's 10-year benchmark federal paper rose 0.23% to 7.019 compared with previous session close of 7.003.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 94.9425 compared with its close of 94.7300 during the previous trading session.

MCX Gold futures for 5 June 2026 settlement fell 0.55% to Rs 154,725.

The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.14% to 99.05.

The United States 10-year bond yield rose 0.34% to 4.467.

In the commodities market, Brent crude for August 2026 settlement surged $2.91 or 3.19% to $94.03 a barrel.

Global Markets:

US Dow Jones futures surged 221 points, pointing to a strong opening for Wall Street later in the day.

European indices traded mostly higher despite escalating geopolitical tensions in the Middle East. Israel reportedly ordered its military to expand operations deeper into Lebanon on Sunday, while the US and Iran exchanged strikes overnight.

Asian shares ended mostly in positive territory on Monday. South Korean equities outperformed the region and touched fresh record highs. However, investor sentiment remained cautious amid uncertainty surrounding US-Iran negotiations after US President Donald Trump said he was in no hurry to finalise a deal aimed at ending the conflict.

In an interview with Lara Trump on Saturday, Trump said the US and Iran had yet to reach a final agreement. He reiterated that any deal must ensure Iran never acquires a nuclear weapon. While expressing a preference for a diplomatic resolution, he warned that military action could resume if talks break down.

Meanwhile, China's manufacturing sector expanded at a faster-than-expected pace in May, according to a private survey. The RatingDog China General Manufacturing Purchasing Managers' Index, compiled by S&P Global, rose to 51.8, slightly above market expectations of 51.6. The reading, however, contrasted with softer official data that pointed to weakening momentum in the sector.

On Wall Street last Friday, major US indices ended at record highs, supported by gains in technology stocks and easing crude oil prices. The Nasdaq Composite advanced 0.20% to 26,972.62, while the S&P 500 rose 0.22% to 7,580.06. The Dow Jones Industrial Average gained 363.49 points, or 0.72%, to close at 51,032.46. All three benchmarks also touched fresh intraday record highs during the session.

Auto sales:

TVS Motor Company shed 0.34%. The company has recorded monthly sales of 566,585 units in May 2026 with a growth of 31% as against 431,275 units in May 2025.

Mahindra & Mahindra declined 2.48%. The company said that its overall auto sales for the month of May 2026 stood at 99,636 vehicles, a growth of 20% as compared with the sales figure of 83,010 units recorded in May 2025.

Meanwhile, M&M's Farm Equipment Business (FEB) has recorded domestic sales of 47,845 units in May 2026 as against 38,914 units in May 2025, reflecting a 23% year-on-year growth. Exports for the month stood at 1,850 units, up 7% YoY.

Maruti Suzuki India slipped 1.38%. The company reported a 34.76% jump in total sales to 2,42,688 units in May 2026 compared with 1,80,077 units in May 2025.

VST Tillers Tractors added 0.62% after the company reported a 28.28% year-on-year increase in total sales for May 2026, with overall volumes rising to 4,472 units from 3,486 units in May 2025.

Hyundai Motor India lost 2.16%. The company has reported 4.15% increase in total sales for May 2026, selling 61,137 units during the month as against 58,701 units sold in the same period last year.

Escorts Kubota slipped 3.39%. The company reported an 18.9% year-on-year increase in tractor sales for May 2026, with total volumes rising to 12,310 units compared to 10,354 units in May 2026.

Stocks in Spotlight:

The Nifty IT index surged 2.66% today. Tech Mahindra (up 3.71%), Infosys (up 3.67%), LTM (up 3.65%), Persistent System (up 3.57%), Coforge (up 2.55%) were top gainers in the pack.

The rally in IT shares comes after a sharp selloff earlier this year triggered by advances in artificial intelligence, including Al startup Anthropic's Claude Cowork agent, which can automate tasks across legal, sales, marketing and data analysis functions.

Zee Entertainment Enterprises (ZEEL) gained 2.88% after securing exclusive rights to broadcast 39 FIFA events in India through 2034, including the FIFA World Cup 2026, FIFA World Cup 2030 and FIFA Women's World Cup 2027.

PTC Industries surged 14.19% after the company's consolidated net profit surged 143.83% to Rs 59.91 crore in Q4 FY26 from Rs 24.57 crore in Q4 FY25. Revenue from operations jumped 84.95% YoY to Rs 225.47 crore in the quarter ended 31st March 2026.

NMDC Steel soared 13.18% after the company reported a sharp turnaround in its March quarter earnings, aided by higher sales. On a standalone basis, the company posted a net profit of Rs 391.91 crore in Q4 FY26 compared with a net loss of Rs 473.39 crore in Q4 FY25. It also returned to profitability on a sequential basis from a net loss of Rs 243.97 crore in Q3 FY26. Revenue from operations jumped 36.67% YoY and 28.97% QoQ to Rs 3,879 crore in the March 2026 quarter.

Wockhardt surged 5.98% on Monday after the company received approval from the U.S. Food and Drug Administration (FDA) for ZAYNICH. The novel intravenous antibiotic is indicated for the treatment of adults with complicated urinary tract infections (cUTI), including pyelonephritis. The approval marks a major milestone for the Mumbai-based drug maker, coming just days after the antibiotic received marketing approval in India on 27 May 2026. According to the company, ZAYNICH is the first new chemical entity fully discovered, developed and commercialised by an Indian pharmaceutical company to secure U.S. FDA approval.

Indo Count Industries jumped 7.26% after the company's consolidated net profit jumped 15.02% to Rs 24.20 crore on 3.43% rise in revenue from operations to Rs 1,057.67 crore in Q4 FY26 compared with Q4 FY25. Further, the finance ministry on Saturday said all customs duties on cotton imports will be waived from 1 June 2026 to 30 October 2026. The move is aimed at boosting cotton supplies for textile exporters amid strong global demand for yarn.

Rubicon Research climbed 16.46% after the company's consolidated net profit soared 100% to Rs 76.78 crore on 43.49% increase in revenue from operations to Rs 513.91 crore in Q4 FY26 over Q4 FY25.

Puravankara slipped 2.29%. The company said it has signed a joint development agreement (JDA) for an 11.23-acre land parcel in Doddagubbi, North Bengaluru.

Godrej Properties (GPL) declined 2.75%. The company said it has won the bid for a 23.2-acre residential land parcel in the DMIC Integrated Township in Greater Noida through an e-auction conducted by DMIC Integrated Industrial Township Greater Noida.

Antony Waste Handling Cell lost 1.20% after the company reported 18.73% decline in consolidated net profit to Rs 32.51 crore in Q4 FY26 compared with Rs 40 crore posted in Q4 FY25. Revenue from operations increased 17.76% YoY to Rs 285.76 crore in Q4 FY26.

Olectra Greentech rallied 4.29% after the company reported a strong performance for the quarter ended 31 March 2026. The company's consolidated net profit surged 164.38% to Rs 55.52 crore on 43.62% jump in revenue from operations to Rs 644.72 crore in Q4 FY26 over Q4 FY25.

Ingersoll-Rand (India) fell 11.14% after the industrial equipment manufacturer reported a weak set of Q4 FY26 numbers. The company's standalone net profit declined 4.21% YoY and 9.85% QoQ to Rs 64.81 crore in Q4 FY26. Revenue from operations stood at Rs 299.63 crore in the March 2026 quarter, down 7.05% YoY and 34.22% QoQ.

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