Nifty nears critical 24,700 support: Will Indian markets face deeper fall?

Indian equity markets faced a sharp downturn on June 12, with the Nifty 50 index closing at 24,888.2, down 253.21 points, approaching a critical support level of 24,700. The Sensex plunged 823.16 points to 81,691.98, wiping out approximately 95 lakh crore in market capitalization in a single session.

The selloff was driven by escalating geopolitical tensions between Iran and the United States, which pushed crude oil prices higher, intensifying investor risk aversion. Vinod Nair, Head of Research at Geojit Investments, noted, "Valuation concerns and rising oil prices--driven by Middle East tensions--are fueling risk aversion among investors."

Mid and small-cap stocks also suffered, declining over 1%, while FMCG shares extended losses after a recent rally, with Dabur falling nearly 3%. Airline stocks were hit following a tragic Air India crash near Ahmedabad, with IndiGo shares dropping 3% intraday.

Market analysts warn that the Nifty's failure to hold above 24,700 could trigger further downside. "This reflects rejection from higher levels and rising pressure near the 25000 zone. A move below 24700 may trigger further downside, while bulls need to reclaim 25000 to regain momentum," analysts said.

The sharp decline ended a six-day rally, highlighting growing concerns over valuations and external risks. Investors remain cautious as the market navigates geopolitical uncertainties and domestic economic pressures.

Key stats:
- Sensex fell 823.16 points (1%) to 81,691.98
- Nifty 50 dropped 253.21 points to 24,888.2
- Market capitalization declined by 95 lakh crore
- Mid and small-cap indices down over 1%
- Dabur shares down nearly 3%
- IndiGo shares down 3% intraday

The market's near-term direction hinges on whether the Nifty can hold above the 24,700 support level amid ongoing geopolitical and economic challenges.

Indian markets faced sharp declines on June 12, with the Nifty 50 dropping 253 points to 24,888, nearing critical support at 24,700 amid rising geopolitical tensions and oil prices. The Sensex fell over 823 points, erasing ₹5 lakh crore in market value, raising concerns of deeper falls ahead.