Sensex slips over 200 points, Nifty ends below 25K as Iran-Israel conflict enters day 5; pharma stocks bleed

Stock market today: Indian equities ended lower on Tuesday, June 17, as continued tensions between Iran and Israel kept investor sentiment fragile. The two nations exchanged attacks for the fifth consecutive day, reinforcing risk-off sentiment in the markets.

The Nifty 50 lost 93 points, or 0.37%, to close at 25,843 points, while the Sensex concluded the session with a drop of 212 points, or 0.26%, to settle at 81,583 points. The fall was led by the pharma stocks, along with metal and media counters, with profit-booking seen after Monday's sharp rally. 

The indices remained in a tight range throughout the day, signaling that investors are also awaiting key developments lined up this week, including the U.S. Federal Reserve's policy decision, which is set to be announced on Wednesday.

The central bank is widely expected to keep rates unchanged, and markets are pricing in no chance of a reduction in July either. Meanwhile, little progress on trade negotiations between the U.S. and its trading partners, along with President Trump’s announcement that pharmaceutical tariffs are coming soon, has also weighed on market sentiment.

US retail sales figures are due today, and weekly jobless claims will be out tomorrow, which will provide further insight into the health of the US economy. While the equities continue to drift lower, gold is seeing a surge in demand as prices rise to $3,390 per ounce on Tuesday, as investors shift their focus to safe haven bets amid heightening Middle East conflict.

Meanwhile, Israel appeared to be expanding its air campaign on Tehran five days after its surprise attack on Iran's military and nuclear program, as U.S. President Donald Trump posted an ominous message warning resident of the city to evacuate, AP reported.

“IRAN CAN NOT HAVE A NUCLEAR WEAPON,” Trump wrote Monday night before returning to Washington early from a Group of Seven summit in Canada. “Everyone should immediately evacuate Tehran!” he added.

Trump later denied reports that he had rushed back to Washington to work on a ceasefire, saying his early departure “has nothing to do with a ceasefire.” Much bigger than that,” without elaborating.

Sectoral Performance: Pharma stocks drag; IT sole gainer

Among the 13 sectoral indices, only Nifty IT managed to end in the green amid broad-based selling, closing with a gain of 0.7%. On the flip side, Nifty Pharma led the losers’ list as investors reacted to Donald Trump’s tariff threats on pharmaceuticals, dragging the index down nearly 2%.

Metal stocks also continued to face pressure as concerns grew that the geopolitical tensions would dampen demand for base metals, resulting in a 1.45% drop in the Nifty Metal index.

Other indices, including Nifty PSU Bank, Nifty Oil & Gas, Nifty Auto, and Nifty Realty, also ended the session in the red, with losses ranging between 0.6% and 0.8%.

Commenting on today's market movement, Vinod Nair, Head of Research, Geojit Investments Limited, said, “The benchmark equity index experienced moderate losses amid rising risk of an escalation of conflicts in the Middle East ahead of the FOMC meeting. This uncertainty pushed Brent crude prices higher—an unfavourable development for India, given its heavy reliance on oil imports, thereby dampening earnings growth. In the broader market, key sectors such as auto and metals came under selling pressure. Meanwhile, the IT sector witnessed rebalancing, influenced by a strengthening U.S. dollar and anticipation surrounding the Fed’s upcoming interest rate decisions.”

Nifty 50 at risk of deeper fall if it slips below 24,850, says experts

Rupak De, Senior Technical Analyst at LKP Securities, said, "Nifty faced resistance around 25,000, leading to a correction to the support level of 24,850. On the hourly timeframe, the index continues to trade above the 200-DMA. However, the RSI is showing a bearish trend on both the daily and hourly charts, indicating weak momentum in the near term."

"With conflicting technical signals and investors awaiting the outcome of the Fed policy meeting, we expect range-bound movement in the immediate term. A decisive break below 24,850 could trigger further bearishness, while on the higher side, 25,000 is likely to remain a strong resistance," he further added.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.