Sensex, Nifty see high volatility after India avenges Pahalgam attack

Mumbai, May 7 (PTI) Benchmark indices Sensex and Nifty witnessed high volatility in early trade on Wednesday after India launched missile strikes on terrorist hideouts in Pakistan and Pakistan-Occupied Kashmir.

Markets faced extreme volatile trends during the early trade. The Sensex hit the day’s high of 80,844.63 and an intra-day low of 79,937.48. The Nifty hit a high of 24,449.60 and a low of 24,220.

Retaliating against the Pahalgam terror attack, Indian armed forces on early Wednesday carried out missile strikes on nine terror targets in Pakistan and Pakistan-Occupied Kashmir, including the Jaish-e-Mohammad stronghold of Bahawalpur and Lashkar-e-Taiba’s base in Muridke.

The military strikes were conducted under ‘Operation Sindoor’ two weeks after the Pahalgam attack that killed 26 civilians.

“What stands out in ‘Operation Sindoor’ from the market perspective is its focused and non-escalatory nature. We have to wait and watch how the enemy reacts to these precision strikes by India. The market is unlikely to be impacted by the retaliatory strike by India since that was known and discounted by the market,” VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.

The main catalyst of the market resilience in India is the sustained FII buying of the last 14 trading days which has touched a cumulative figure of Rs 43,940 crore in the cash market, he said.

“FIIs are focused on the global macros like weak dollar, slower growth in the US and China in 2025, and India’s potential outperformance in growth. This can keep the market resilient. However, investors have to watch the developments in the border,” Vijayakumar added.

From the Sensex firms, HCL Tech, Asian Paints, Hindustan Unilever, Sun Pharma, UltraTech Cement and Nestle were among the laggards.

Tata Motors, State Bank of India, HDFC Bank, IndusInd Bank, Bajaj Finance and Power Grid were among the gainers.

Foreign Institutional Investors (FIIs) bought equities worth Rs 3,794.52 crore on Tuesday, according to exchange data.

In the Asian market, South Korea’s Kospi, Shanghai’s SSE Composite index, and Hong Kong’s Hang Seng were quoting in the positive territory while Japan’s Nikkei 225 traded lower.

US markets ended lower on Tuesday.

“Markets now hinge on three catalysts: further military action, global tariff progress, and the US Fed’s policy decision on May 7,” Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.

India and the UK on Tuesday sealed a landmark free trade agreement that will lower tariffs on 99 per cent Indian exports and will make it easier for British firms to export whisky, cars, and other products to India besides boosting the overall trade basket.

Global oil benchmark Brent crude climbed 0.61 per cent to USD 62.53 a barrel.

Snapping its two days of gains, the BSE benchmark declined 155.77 points or 0.19 per cent to settle at 80,641.07 on Tuesday. The Nifty dipped 81.55 points or 0.33 per cent to 24,379.60.