Sensex and Nifty Decline Amid US-Iran Tensions and Rising Bond Yields; HDFC Bank Shares Gain

Indian equity benchmarks opened lower on Monday as higher bond yields and renewed geopolitical tensions weighed on market sentiment. The Sensex fell over 510 points from Friday’s close, while the Nifty 50 shed 178 points to fall below the 24,000 mark.

At around 10:50 AM, the Sensex traded 475.73 points lower at 76,788.78, hitting an intraday low of 76,751.32. The Nifty 50 fell 167.75 points to 24,007.90, declining to a session low of 23,997.45. Broader markets also faced downward pressure, with the Nifty Midcap 100 and Nifty Smallcap 100 dropping 0.76 percent and 0.90 percent, respectively.

Global sentiment weakened after US forces struck two Iranian launchers, marking the first known American strikes on Iran since late July. Consequently, Brent crude traded around $90 a barrel, up about 2 percent. Market observers noted that the macroeconomic environment was further pressured by comments from Fed chief Kevin Warsh regarding persistence above the Fed's long-term inflation target, raising expectations of a potential rate hike at the upcoming FOMC meeting on September 15-16.

Sectoral performance remained largely negative, with metal, media, realty, and IT stocks leading the declines by falling 1 to 2.5 percent. Private banks were the exception, posting mild gains. Among Nifty 50 constituents, HDFC Bank, Eternal, Bajaj Auto, and ONGC led the gainers, while Adani Enterprises, Hindalco, Infosys, Nestle India, JSW Steel, and Tata Steel were among the top losers.

HDFC Bank, the heaviest-weighted stock on the index, rose more than 2 percent after the lender announced that CEO Sashidhar Jagdishan decided not to seek reappointment when his current term ends in late October. Analysts noted that the update removes uncertainty surrounding a potentially short, RBI-restricted term and paves the way for incoming leadership.

Market activity remained broad-based during the session. Out of 2,999 stocks traded on the NSE, 1,033 advanced, 1,819 declined, and 147 remained unchanged. A total of 78 stocks touched 52-week highs, while 53 hit 52-week lows. Additionally, equity benchmarks faced potential volatility in the final minutes of trade as MSCI-linked investors adjusted portfolios ahead of rebalancing, marking the first major test for the market's new closing auction system.

Key economic data releases scheduled for the day included India’s GDP growth rate and the US Dallas Fed Manufacturing Index, alongside Augmont Enterprises making its exchange debut. Meanwhile, Jio Platforms received SEBI’s observation letter for its proposed IPO.

"The recent market correction underscores how closely domestic equities remain tied to macroeconomic headwinds, particularly rising bond yields and crude oil price volatility driven by geopolitical developments. At the same time, leadership transitions in major financial institutions like HDFC Bank demonstrate how corporate governance updates can momentarily decouple specific large-cap stocks from broader market trends. For businesses and investors navigating this volatile environment, maintaining a focus on fundamental growth drivers remains essential." — Dr. Shishir Gupta, Founder & CEO, StartupLanes