Sensex in freefall: Nifty Bank down 16% since West Asia war began, metals the only bright spot

Indian equity markets opened under significant pressure on Monday morning, with the Nifty Bank index having corrected 16 per cent since the start of the West Asia war in late February. The broader markets were even harder hit, with Nifty MidCap and Nifty SmallCap indices trading down nearly 2 per cent each in early trade.

The sell-off reflects investor anxiety about the compounding effects of the Iran war on the Indian economy — rising oil prices, currency pressure, and the threat of inflation that would constrain the Reserve Bank of India’s ability to cut interest rates. The RBI’s March 27 directive capping bank open positions in the onshore currency market at $100 million per trading day has added another layer of uncertainty.

The one corner of the market defying the gloom is metals. Nalco surged 6.1 per cent, Hindalco rose 4.3 per cent and Vedanta gained 3.7 per cent in morning trade. The gains reflect a global supply chain repositioning — as Middle Eastern shipping routes become unreliable, buyers are moving toward alternative sources, lifting prices for aluminium, copper and zinc.

Gold, which had been volatile for weeks, recovered some early losses to hold near $4,500 per ounce — showing resilience that analysts attribute to sustained safe-haven demand from institutional investors who see no clear resolution to the West Asia conflict on the horizon.

Domestic gold prices in India remained largely steady at ₹1,48,080 per 10 grams for 24-karat gold, though market participants flagged that the week ahead — with US Nonfarm Payrolls data due on Friday — could bring fresh volatility.