The conflict has rattled equity markets and driven oil prices sharply higher. The tense situation in West Asia has dragged the BSE Sensex lower by over 8 per cent so far this month.
The US and Israel launched military strikes on Iran on February 28, killing Ayatollah Ali Khamenei, Iran’s supreme leader.
Following the military offensive, Iran has carried out a wave of attacks targeting Israeli and American military bases in several Gulf countries.
Global oil and gas prices have surged after Iran virtually blocked the Strait of Hormuz, a narrow shipping lane between the Persian Gulf and the Gulf of Oman that handles roughly 20 per cent of global oil and LNG (Liquefied Natural Gas).
Brent crude, the global oil benchmark, surged to the USD 100 per barrel level.
Since February 27, the 30-share BSE Sensex has tumbled 6,723.27 points or 8.27 per cent.The market capitalisation of BSE-listed companies eroded by Rs 33,68,419 crore to Rs 4,29,82,252.27 crore (USD 4.65 trillion) during this time.
“The ongoing conflict in the Middle East has now entered its second week with no clear signs of de-escalation, as both sides continue to exchange strikes and threats. This prolonged uncertainty has kept risk aversion elevated across global financial markets,” Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm, said.
The Middle East conflict and the sharp rise in energy prices continue to be the dominant factors shaping sentiment across equities, bonds, and currency markets, he added.
On Friday, the Sensex tumbled 1,579.82 points, or 2 per cent, to 74,454.60 during intra-day trade. The benchmark finally settled at 74,563.92, down 1,470.50 points, or 1.93 per cent.
“Benchmark indices extended their decline on March 13, falling for the third consecutive session as weak global cues and persistent foreign fund outflows weighed on investor sentiment, with Brent crude stabilising near USD 100 amid the ongoing West Asia conflict,” according to Bajaj Broking.
Amid surging crude prices, oil marketing companies ended the day lower.
HPCL tumbled 4 per cent, IOC dropped 2.28 per cent, and BPCL declined by 2.19 per cent.
Paint manufacturers also had a rough day in trading.
Asian Paints, Berger Paints, Kansai Nerolac and Shalimar Paints ended in negative territory.
Aakash Shah, Research Analyst, Choice Equity Broking, said, “On 13 March 2026, the BSE Sensex ended the session sharply lower, falling 1,470 points to close at 74,563, marking one of the steepest single-day declines in recent weeks.”
The market remained under strong selling pressure throughout the session as investors reacted to rising geopolitical tensions in the Middle East, a sharp surge in crude oil prices, and continued foreign institutional investor outflows, he added.