Sensex crashes 400 points, Nifty below 24,500 as oil shock and Strait of Hormuz tensions rattle markets

The BSE Sensex declined around 0.5% to 78,114.77, while the NSE Nifty 50 slipped 0.5% to 24,460.90 at the opening bell.

Oil prices, Strait of Hormuz in focus

Investors remained cautious amid concerns over developments in the Strait of Hormuz, a key global oil-shipping route.

Crude oil prices rose sharply in the previous session amid renewed geopolitical tensions, raising concerns over the impact of higher energy costs on inflation and corporate earnings in oil-importing economies such as India.

Brent crude was trading near $88 a barrel on Tuesday, keeping pressure on markets as investors assessed the potential disruption to oil supplies and shipping through the region.

Asian markets mixed

Asian equities traded mixed on Tuesday. Japan's market remained in positive territory, while South Korean and Chinese stocks declined.

The mixed regional cues, along with elevated crude prices and geopolitical uncertainty, contributed to a cautious mood in Indian equities.

Global cues to guide markets

Investors are also tracking developments around US-Iran tensions and upcoming US inflation data, which could influence expectations around the US Federal Reserve's monetary policy.

On Monday, Indian equities had ended largely flat as gains from global cues and selective buying were offset by concerns over rising crude prices and geopolitical tensions. The Nifty had closed at 24,583.

With the earnings season nearing its final phase, market participants are expected to focus on company-specific developments alongside global macroeconomic and geopolitical cues.