The currency market also came under pressure from West Asia tensions. The rupee weakened to 91.23 against the US dollar in early trade. Earlier on Friday, it had closed at 91.08 against the dollar, down 17 paise.

Stock markets fall amid tensions in West Asia.

Stock Market News: The impact of rising geopolitical tensions in the Middle East is clearly visible on the Indian domestic market. The BSE Sensex fell 1,579 points around 1 p.m., while the Nifty 50 fell 478 points. However, by evening, the Sensex closed down 1,048 points, while the Nifty closed below 24,900. Selling pressure was seen in almost all major sectors. Let's understand the main reasons for this decline:

1. Growing uncertainty in West Asia

Escalating tensions between Iran and Israel have destabilized global markets. Recent military actions and retaliatory strikes have increased instability across the region, raising fears of a wider conflict. Experts believe that if this tension continues, it could have a direct impact on energy supplies and global trade.

Amid the tensions, global oil benchmark Brent crude rose by more than 7%, reaching a multi-month high of $82.40 per barrel. The surge in crude oil prices particularly impacted stocks of oil marketing companies, paint companies, and the aviation sector, as their cost structures are directly linked to crude prices.

2. Selling by foreign investors

Foreign institutional investors (FIIs) sold net shares worth ₹7,536.4 crore on February 27. Continued foreign capital outflows have prevented the market from providing support, further accelerating the decline.

3. Sharp jump in India VIX

The market's nervousness was also reflected in the volatility index. The India VIX jumped 15% to 15.78. A rise in the India VIX indicates that investors are anticipating more volatility in the coming days.

4. Pressure on the rupee

The currency market also came under pressure. The rupee weakened to 91.23 against the US dollar in early trade. Earlier on Friday, it had closed 17 paise lower at 91.08 per dollar. The main reasons for the rupee's weakness include rising crude oil prices, selling by foreign investors, and a global shift toward safe-haven investments.

Ongoing tensions in West Asia, rising crude oil prices, selling by foreign investors, and a weakening rupee have all combined to dampen Indian market sentiment. The market's direction in the coming sessions will largely depend on how quickly the geopolitical situation normalizes and the direction oil prices take.