Indian equity benchmarks opened sharply lower on Friday and continued to trade with significant volatility through the morning session, as escalating tensions in the Middle East pushed global crude oil prices higher and dampened investor sentiment.

At around 10:46 AM IST, the BSE Sensex was trading 380–450 points lower, hovering near the 79,570 level, while the NSE Nifty 50 was down about 100 points, struggling to hold the 24,650 mark after touching an intraday low of 24,598.

Currency markets also reflected the cautious mood. The Indian rupee traded flat to slightly weaker at 91.64–91.65 per US dollar, indicating pressure from rising oil prices and global risk aversion.

Oil Above $83 Raises Macro Concerns

Investor sentiment has been weighed down by escalating geopolitical tensions involving Iran, Israel, and the United States, which have triggered a spike in energy prices. Brent crude oil has climbed above $84.41 per barrel, raising concerns for oil-importing economies like India. Higher crude prices typically increase the country’s import bill, inflation risks, and fiscal pressures, prompting investors to move into defensive assets.

The uncertainty has also triggered a risk-off trade, with Foreign Institutional Investors (FIIs) continuing to reduce exposure to emerging markets, offloading equities worth ₹3,752.52 crore on March 5 alone. This added significant selling pressure on Indian equities, with the Sensex tumbling 572 points to 79,443 and the Nifty 50 dropping 178 points to 24,587 in early trade.

IT, Power and Defence Lead Gains

Despite the broader weakness, select sectors managed to remain in positive territory, driven by currency movements and sector-specific triggers.

• The IT sector was among the top gainers in morning trade, with the Nifty IT index rising 1.57%. Export-oriented IT companies tend to benefit when the rupee weakens, as overseas revenues translate into higher earnings.
• Large-cap IT names saw steady buying interest as the rupee hovered near the 91.65 mark. Infosys rose 1.1% to ₹1,307.50, TCS gained 0.8% to ₹2,587.80, and HCLTech climbed 1.4% to ₹1,364.00, improving margin expectations for companies with strong US and global exposure.
• Defence counters continued their upward momentum amid heightened geopolitical concerns and increased focus on security spending. Key stocks such as Bharat Electronics Ltd (BEL) witnessed a jump of 1.91% to ₹468.75, while Hindustan Aeronautics Ltd (HAL) rose 0.70% to ₹4,215.00 following reports of fresh defence orders.
• The sector has been among the best-performing pockets of the market in 2026, with the Nifty India Defence index delivering double-digit gains over the past few months.

Power and Energy Counters Attract Buyers

Power and infrastructure-related stocks also saw selective buying. Reliance Industries (RIL) showed resilience, rising 2.12% to ₹1,418.80 as markets reacted to the 30-day US waiver for Russian oil. Companies such as Rail Vikas Nigam Ltd (RVNL) gained 5.00% to ₹293.20, and Tata Power hovered at ₹365.85 as investors bet on the strategic importance of energy security during geopolitical disruptions. The shift toward domestic infrastructure and power capacity expansion has kept investor interest intact in this segment even during broader market corrections.

Banking and Aviation Stocks Under Pressure

The weakness in benchmark indices was largely driven by heavy selling in financial and aviation stocks.

Major banking stocks were among the biggest drags on the indices, with the Nifty Private Bank index falling 1.28%.

• Shares of HDFC Bank fell 1.53% to ₹864.40, and ICICI Bank dropped 1.7% to ₹1,354.70, contributing significantly to the decline in the Sensex and Nifty 50.
• Other laggards included Axis Bank, which slipped over 1%, as cautious investor positioning amid global uncertainty kept the banking pack under pressure.

Aviation stocks also faced selling pressure as crude oil prices surged.

• Shares of IndiGo dropped 1.73% to ₹4,435.00 amid concerns that rising Aviation Turbine Fuel (ATF) costs could squeeze airline margins.
• SpiceJet also saw volatility, trading near ₹14.28, as the stock reacted to a recent downgrade in price targets by brokerages, which cited cost pressures and volatile oil prices.