Indian benchmark indices, Sensex and Nifty 50, are likely to open lower on Monday as the escalating overnight Middle East conflict unsettled global investors after US and Israeli strikes on Iran reportedly killed Iran’s Supreme Leader Ayatollah Ali Khamenei.

Asian markets fell sharply, US stock futures declined, and investors rushed to safe-haven assets, pushing gold prices higher alongside a sharp surge in crude oil prices.

This week, market participants will closely track major triggers such as developments in the US–Iran conflict, movements in crude oil, gold and silver prices, foreign fund flows, and key domestic as well as global macroeconomic data releases.

Moreover, on Friday, the Indian stock market plunged as the intensifying US–Iran war dampened investor sentiment, especially in the absence of any strong domestic catalyst.

Domestic Market Recap

On Friday, Indian indices closed red:

• Sensex slumped by 961.42 points (1.17%) to close at 81,287.19
• Nifty 50 moved down by 317.90 points (1.25%) to settle at 25,178.65

Gift Nifty

Gift Nifty was trading near 25,223, around 115 points lower than the previous Nifty futures close, hinting at a negative start for Indian markets.

Overnight Wall Street Performance

On Friday, the US stock market closed lower as losses in financial and technology stocks pulled the indices down, leading all three major benchmarks to record sharp weekly declines. The S&P 500 and the Nasdaq posted their steepest monthly drops since March 2025, while the Dow Jones managed to notch its tenth consecutive month of gains.

• The Dow Jones Industrial Average slipped by 521.28 points (1.05%) to close at 48,977.92.
• S&P 500 down by 29.98 points (0.43%), ending at 6,878.88.
• The Nasdaq Composite was lower by 210.17 points (0.92%), finishing at 22,668.21.

Crude Oil Prices

• Brent crude skyrocketed by 7.60% to $78.41/barrel
• US West Texas Intermediate (WTI) crude was trading 7.19% higher at $71.86/barrel

Overnight Major Global Events Driving Sentiment

1. US–Israel–Iran War: The conflict in the Middle East intensified after US–Israel joint strikes killed Iran’s Supreme Leader Ayatollah Ali Khamenei. US President Donald Trump stated that 48 Iranian leaders have died in the ongoing US–Israeli military operations. Following Khamenei’s death, authorities named Ayatollah Arafi as the Islamic Republic’s interim Supreme Leader, further escalating geopolitical tensions in the region.
2. India GDP Growth: Under the revised GDP series, India’s economy grew 7.8% in the October–December quarter, accelerating from 7.4% in the same period last year. The government also revised the full-year FY26 growth estimate upward to 7.6%, compared with the earlier 7.4% projection released in January. The updated data placed economic growth for the previous fiscal year at 7.1%.
3. OPEC Output Decision: OPEC has decided to resume oil production increases next month despite rising tensions triggered by US–Israeli strikes on Iran. Key producers, led by Saudi Arabia and Russia, will collectively raise output by 206,000 barrels per day, according to an official statement. This increase surpasses the monthly addition of 137,000 barrels per day planned for the fourth quarter and comes amid heightened volatility in the Middle East.

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