Sensex today falls over 130 points, Nifty ends below 24,850 as geopolitical tensions weigh; all eyes on US Fed

Stock market today: Indian frontline indices remained range-bound for another session as ongoing geopolitical tensions continued to weigh on sentiment. Investors also stayed cautious ahead of the U.S. Federal Reserve policy decision, due later today, which is expected to set the tone for global equities.

Although the Nifty 50 and Sensex gained momentum during the first half of the trading session, profit booking at higher levels led both indices to end with mild losses. Mid- and small-cap stocks also reversed from their intraday highs.

The Nifty 50 shed 40 points, or 0.14%, to close at 24,843, while the Sensex ended 105 points lower, or 0.13%, at 81,479. The decline was led by losses in tech, FMCG and media stocks.

Global equities remain on edge as tensions between Iran and Israel entered their sixth day, with growing concerns over potential U.S. military involvement and the risk of a broader regional conflict.

On Tuesday, U.S. President Donald Trump demanded Iran’s "unconditional surrender" and warned of a possible strike against the country’s Supreme Leader, Ayatollah Ali Khamenei, in a social media post ahead of his meeting with the national security team.

The conflict between the two countries began on Friday after Israel struck at Iranian nuclear and military facilities with the objective of preventing Iran from building a nuclear weapon. Meanwhile, the drop in US retail sales during May has brought recession fears back to the surface.

Looking ahead, war jitters are likely to keep a lid on optimism. But so is a hawkish message later today by the Federal Reserve.

Sectoral Performance: IT stocks bleed, auto stocks manage to buck the trend

Among the 13 major sectoral indices, 11 ended in the red, with tech stocks emerging as the top losers. Recession fears in the U.S. resurfaced after retail sales narrowed in May, and investors stayed cautious ahead of the U.S. Federal Reserve meeting. As a result, the Nifty IT index fell 0.83%, snapping its three-day winning streak.

Meanwhile, metal stocks extended their losing streak as the conflict between Israel and Iran entered its sixth day on Wednesday, with no signs of de-escalation. This raised concerns that a prolonged conflict could lower demand for base metals. The Nifty Metal index shed 0.72% in intraday trade.

Other sectoral indices, including Nifty FMCG, Nifty Realty, and Nifty PSU Bank, also closed in the red, posting losses in the range of 0.4% to 0.5%.

On the winning side, auto stocks outperformed the frontline indices, with the Nifty Auto index closing 0.37% higher amid reports that India is exploring Australia as an alternative source for rare-earth magnets, in a bid to reduce its dependence on China.

Nifty closes below key support, Fed outcome holds the key

Rupak De, Senior Technical Analyst at LKP Securities, said, "The index remained volatile throughout the day as updates related to the Israel-Iran conflict and the possibility of U.S. kinetic intervention weighed on global sentiment. Additionally, anticipation ahead of the upcoming Fed meeting contributed to the instability in the Indian market."

"On the technical front, Nifty closed below the crucial support level of 24,850. However, a positive surprise from the Fed could lift both global and domestic markets, helping them shake off prevailing negativity. On the upside, a decisive reclaim of 24,850 may trigger a rally towards 25,000 and higher, while a failure to move back above this level could drag Nifty down towards 24,500," Rupak further added.

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