Unleashing Volatility: Key Drivers for Dalal Street This Week – Israel-Iran War, IPOs, and FII Movements
Indian stock market benchmarks, the Sensex and Nifty 50, posted robust gains on Friday, June 20, despite rising tensions between Israel and Iran. As the United States officially entered the conflict, striking Iranian nuclear facilities, investors are now poised to closely monitor geopolitical developments as markets prepare to reopen on Monday.
The Sensex started Friday at 81,354.85, slightly down from its previous close of 81,361.87. However, it surged 1,133 points, or 1.4%, reaching an intraday high of 82,494.49. Similarly, the Nifty 50 opened at 24,787.65, compared to its last close of 24,793.25, climbing 1.4% to hit an intraday peak of 25,136.20. Ultimately, the Sensex closed at 82,408.17, up 1,046 points or 1.29%, while the Nifty 50 settled at 25,112.40, a rise of 319 points or 1.29%.
“Markets experienced consolidation following a recent subdued trend, bolstered by strong European cues and positive Dow Futures, leading to a significant rally in local benchmarks. Additionally, investors engaged in short covering ahead of next week’s monthly derivatives expiry. Despite the rebound, caution remains due to the ongoing West Asia conflict; any surge in crude oil prices from rising tensions could introduce volatility,” noted Prashanth Tapse, Senior VP of Research at Mehta Equities Ltd.
While the market remained in a consolidation phase for the fifth consecutive week, it still closed with notable gains, fueled by diminishing geopolitical tensions and a resurgence of activity among foreign institutional investors (FIIs). Although the week began quietly, the indices gained momentum in the latter half, particularly in heavyweight sectors such as banking and IT, finishing near their weekly highs.
Rupak De, Senior Technical Analyst at LKP Securities, highlighted the Nifty’s sharp upward movement after three days of consolidation. “The index has reclaimed the 21-day EMA, indicating potential upward momentum. As long as it holds above 24,850, it remains a ‘buy on dips,’ with prospects of advancing towards 25,350 and beyond.”
Regarding the Bank Nifty, Ajit Mishra, SVP of Research at Religare Broking Ltd, commented on its resilience, particularly from private banking giants like HDFC Bank and ICICI Bank. “Having reclaimed levels above 56,000, it could gradually trend toward 57,000 and 58,200, with the 54,000–55,100 zone providing support in case of a pullback.”
Key triggers for the stock markets in the coming week include the escalating conflict between Israel and Iran. The U.S. has initiated strikes on Iranian nuclear facilities, intensifying concerns about a broader regional conflict. Iran has vowed retaliation, putting the U.S. on alert and prompting evacuation flights from Israel.
Additionally, a significant development in the U.S.-India trade agreement may influence market dynamics, with expectations that the deal will materialize before the imposition of the scheduled reciprocal tariffs on July 9. In the primary market, 17 new public issues will debut next week, alongside eight anticipated listings, which could attract investor interest.
Foreign institutional investors maintained a buying spree on June 20, recording a net equity purchase of ₹7,940.70 crore, marking the third highest single-day inflow of the year. This streak of FII inflows signifies renewed foreign interest in Indian markets, despite geopolitical uncertainties and potential impacts from the Israel-Iran conflict.
Finally, crude oil prices experienced a decline after the U.S. imposed new sanctions on Iran, creating expectations for a diplomatic resolution. Brent crude futures fell by $1.84, or 2.33%, to close at $77.01 per barrel.
As the market prepares to navigate these developments, investors are urged to remain vigilant while considering potential opportunities.
Tags: Indian Stock Market, Sensex, Nifty 50, Geopolitical Tensions, Foreign Institutional Investors, Crude Oil Prices.
Original Source: https://www.livemint.com/market/stock-market-news/week-ahead-israel-iran-war-ipos-fiis-among-key-market-triggers-for-indian-stock-market-11750543094905.html
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Publish Date: 2025-06-23 06:42:00
