Stock market crash: After crashing below 23,000 levels after the outbreak of the US-Iran war, the Nifty 50 index staged a strong recovery from 22,500 levels. In this recovery of the Indian stock market, the Bank Nifty index reclaimed the psychological 56,000 level, while the 50-stock index established a strong base around 24,000.
However, in the last three straight sessions, the key benchmark indices of Dalal Street witnessed sharp selling, and the Nifty 50 index slipped below 24,000 and finished close to its immediate support at 23,800 to 23,850. This fresh sell-off has cast doubt in the minds of market bulls on whether the Indian stock market has discounted the US-Iran war or whether the Nifty 50 is poised to hit a new low by breaking below 22,000.
According to stock market experts, the Indian market has partially priced in the US–Iran war. They believe Dalal Street has absorbed the initial shock; however, in the wake of prolonged escalation around the Strait of Hormuz, the possibility of more downside is highly likely.
Crude oil price movement in focus
Hariprasad K, SEBI-registered Research Analyst and Founder of Livelong Wealth, believes the initial shock has been absorbed through a meaningful correction, but current price action suggests the market is still reacting to headlines rather than fully discounting worst-case risks.
“The real pressure point remains the crude oil price rise. With Brent crude oil price holding above $100, the macro impact is significant. For every $10 rise in oil prices, India’s current account deficit widens materially, which directly feeds into currency weakness. The rupee touching around ₹94.85 per dollar reflects that stress, alongside continued foreign outflows,” said Hariprasad K of Livelong Wealth.
Nifty 50 to Sensex: Fair valuations you must know
Expecting more pain for the Nifty 50, Sensex and other major Indian indices, if there is further escalation in the US-Iran war, Nitant Darekar, Research Analyst at Bonanza, said, “ Since Operation Epic Fury began on 28 February 2026, the Nifty and Sensex are down just about 3%, with the BSE market cap back at pre-war levels — an impressive optical recovery, but one almost entirely engineered by DII absorption (April MTD DII buying of ₹33,837 Cr against FII outflows of ₹44,281 Crore; cumulative FII outflows ₹1.61 lakh Crore since Feb-end).”
The Bonanza expert said the underlying shock is far from priced in: Brent-linked Indian crude basket is at US$100.4/bbl versus US$69 in February (+45%), the Rupee has weakened about 2%, and India VIX is rising. With the ceasefire fragile, the US blockade intact, and Hormuz still effectively shut, markets are discounting a quick peace rather than a prolonged war. Asymmetric downside risk remains.
“Valuations have corrected, with the Nifty now trading near 19x earnings versus its long-term average of around 22x. That brings the market closer to fair value, but not necessarily to a deep-value zone, especially given rising earnings risks. Global brokerages like HSBC have already flagged this by moving to an underweight stance, citing potential delays in earnings growth due to persistent energy-driven inflation,” Hariprasad K of Livelong Wealth said.
The Livelong Wealth expert said that, from a market-behaviour standpoint, the trend still reflects a sell-on-rise structure. Rallies driven by temporary geopolitical relief or ceasefire headlines are not sustaining, indicating that institutional conviction remains cautious. FII selling continues to be a structural overhang, limiting upside follow-through.
Oil-sensitive sectors like aviation, consumption, and IT are under pressure, while defensives and commodity-linked pockets are relatively resilient. This suggests the market is selectively pricing risk rather than fully capitulating.
“The market has discounted the immediate shock, but has not fully priced in a scenario of sustained geopolitical disruption or a prolonged oil shock. The next directional move will depend less on technicals and more on whether crude stabilises and geopolitical clarity emerges. Until then, volatility and headline-driven moves are likely to dominate,” concluded Hariprasad K of Livelong Wealth.
Stock market today: Outlook for Nifty 50, Sensex today
Speaking on the outlook of the Nifty 50 and the Sensex today, Amol Athawale, VP — Technical Research at Kotak Securities, said that on the weekly chart, the Nifty 50 and the 30-stock index Sensex have formed a bearish candle, and on daily charts, a reversal formation has appeared, which supports further weakness from the current levels.
“We are of the view that 24,000/77000 would act as a crucial reference point for traders. Below this level, the correction wave is likely to continue, with the index potentially slipping to the 20-day SMA or 23,635/76000. Further downside could also continue, dragging the index to the 23,500-23450/ 75700-75500 range,” said Amol Athawale.
On the outlook of the Bank Nifty today, Amol Athawale said, “For Bank Nifty, as long as it is trading below the 50-day SMA or 56,800, a weak formation is likely to continue. On the downside, it could retest the 55,000–54,750 range. Conversely, above the 50-day SMA of 56,800, the next resistance for Bank Nifty would be in the 57,500–58,000 range.”
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
