- Rupee hit record low of 92.03 against US dollar amid Middle East conflict fears
- Indian markets lost nearly Rs 9.7 lakh crore in two sessions due to global tensions
- Sensex fell 1,710 points to 78,529; Nifty dropped nearly 477 points below 24,400
Nearly Rs 9.7 lakh crore of investor wealth evaporated from Indian markets in just two trading sessions as the rupee crashed past the 92-per-dollar mark for the first time, rattled by surging oil prices and a rapidly escalating US-Israel conflict with Iran.
Indian equities plunged Wednesday while the rupee sank to a historic low, as global investors rushed for safety amid fears the Middle East war could disrupt oil supplies and ignite inflation in one of the world's fastest-growing economies.
The Indian currency fell 55 paise to 92.03 against the US dollar, breaching the psychologically critical 92 level for the first time ever. The slide eclipsed earlier record lows of 91.99 and 92.02 recorded in late January 2026.
At the same time, the stock market saw a sharp sell-off that erased massive investor wealth. The BSE's total market capitalisation fell from Rs 456.17 lakh crore on Monday to Rs 446.47 lakh crore, wiping out roughly Rs 9.7 lakh crore in value.
The benchmark Sensex tumbled 1,710 points to 78,529, its lowest level since April last year, while the Nifty 50 dropped nearly 477 points to 24,389, slipping below the 24,400 mark for the first time in almost seven months.
Market sentiment soured after the United States and Israel launched military strikes against Iran over the weekend, triggering retaliatory attacks across the oil-rich region. US President Donald Trump said Tuesday that negotiations with Iran were unlikely to prevent further conflict, warning the war could last "four to five weeks."
The escalation has jolted global energy markets. Brent crude surged to around $82.53 a barrel, its highest level since January 2025, while US West Texas Intermediate climbed to about $75.37.
Oil prices spiked after tanker traffic through the Strait of Hormuz stalled following repeated attacks on vessels in the region.
For India, which imports roughly 85% of its crude oil, the surge poses a direct threat to inflation and the trade deficit.
"From India's perspective the real concern is inflation and its impact on growth," said VK Vijayakumar, chief investment strategist at Geojit Investments Limited. He warned that a prolonged war could weaken the rupee further, widen the trade deficit and hurt corporate earnings.
Foreign institutional investors also added pressure on markets. According to NSE data, FIIs sold Rs 3,295.64 crore worth of equities in the previous session, while domestic institutional investors bought Rs 8,593.87 crore.
The sell-off was broad-based. Shares of L&T, IndiGo, Adani Ports, Mahindra & Mahindra and Bajaj Finance dropped between 3% and 6%, though BEL, Infosys and HCL Tech managed early gains.
Vijayakumar urged investors not to panic.
"Markets have an uncanny ability to climb walls of worry," he said. "Long-term investors with higher risk appetite can gradually accumulate quality stocks during corrections."
The turmoil was not limited to India. South Korea's Kospi index plunged more than 12%, highlighting the widening global shockwaves from the Middle East conflict.
