India-Pakistan tension: Here’s how Indian stock market performed after last five conflicts | Stock Market News

Stock market today: The Indian stock market recorded strong gains in Monday morning trade on April 28, with benchmark indices — the Sensex and Nifty 50 — climbing close to 1 percent each, supported by mostly positive global trends despite ongoing tensions between India and Pakistan.

The Sensex surged over 850 points, or 1 percent, reaching 80,073, while the Nifty 50 advanced nearly 250 points, or 1 percent, reclaiming the 24,283 mark.

Despite significant uncertainty about how the situation between India and Pakistan will develop in the coming days, experts highlight that markets are responding positively to India’s diplomatic and strategic handling of the situation, steering clear of an overly aggressive or war-like retaliation.

“The heightened uncertainty relating to Indo-Pak tensions will weigh on the markets. It is very difficult to judge how much the market has discounted. Going by the market’s resilience, it can be said that the market has not discounted a scenario of the tensions culminating in a war between the two countries,” said VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited.

Last week, domestic equity benchmarks Sensex and Nifty 50 recorded a one percent rise. Over the week, the Nifty 50 and BSE Sensex advanced by 0.80 percent, closing at 24,039.35 and 79,212.53, respectively. Market volatility edged higher, with the India VIX climbing 11 percent, partially offsetting the 23 percent drop seen the week before.

“After a positive start supported by favourable global cues, Indian benchmark indices declined sharply. This was on account of profit booking which came in as cross-border tensions between India and Pakistan escalated, following the terrorist attacks in Pahalgam, Kashmir. Nifty ended with loss of 207 points at 24,039 (-0.9%),” said Siddhartha Khemka, Head – Research, Wealth Management, Motilal Oswal Financial Services Ltd.

How Indian market performed in last five conflicts?

Vinod Nair of Geojit Investments Ltd says that India has historically demonstrated strong resilience to geopolitical events, largely due to the strength of its domestic economy.

“Based on the historically performance of India, it has exercised strong resilience during geo-political factors given the buoyant nature of the domestic economy. For long-term investors it is fair to take this as an opportunity to accumulate quality stocks/sectors during further dips for the long-term gain,” Nair added.

Anand Rathi report highlights that, apart from the 2001 Parliament attack, Indian equity markets have rarely seen a correction exceeding 2% during periods of heightened tensions with Pakistan.

Moreover, the market decline during the 2001-02 Parliament attack was likely driven more by global factors, notably the approximately 30% fall in the S&P 500 during that period.

According to the report, equity market corrections during conflicts typically averaged 7%, with the median correction standing at 3%.

“ Based on historical precedent and current global risk pricing, even in the event of a substantial escalation, we believe the Nifty 50 is unlikely to correct more than 5–10%. Investors currently following the 65:35:20 strategy should maintain allocation. Investors who have any equity gap in the portfolio should invest now thereby getting aligned to the strategic allocation of 65:35:20,” the report said.

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