Friday meltdown looms: Markets rattled as India-Pakistan flare-up sparks panic

Indian markets are poised for a potentially negative opening on Friday amid Thursday's flare-up with Pakistan. 

The anticipated slide comes after Pakistan launched drone strikes on parts of Jammu and Kashmir, along with military targets in Punjab, Rajasthan, and Gujarat—an aggressive move that was met with swift Indian countermeasures.

The drone and missile attacks, which lasted nearly 35 minutes, triggered a sharp rise in India’s Volatility Index (VIX), a key gauge of investor fear. As a result, Gift Nifty is trading lower by 1.5–2.5%, suggesting a weak start for both the Nifty and Sensex. Analysts warn of further volatility, particularly if tensions along the border escalate further.

Technical indicators reflect a fragile setup. Nifty’s immediate support is placed at 24,152, and a breach could drag the index toward 24,093 or even 24,000. Resistance stands at 24,273.80, which also marks Thursday’s closing. Market participants are being advised to stick to level-based strategies given the absence of directional clarity.

The ripple effect of the conflict has already spilled into global markets. Indian ADRs (American Depositary Receipts) saw significant declines on U.S. exchanges, with MakeMyTrip plummeting 10%, ICICI Bank falling 4.29%, and HDFC Bank down 4.65%. Wipro, Infosys, and Dr. Reddy’s also saw losses, reflecting investor unease over a prolonged confrontation.

Flight rerouting, airspace restrictions, and the prospect of disrupted trade have further compounded market concerns. On Thursday, the BSE Sensex closed 411.97 points lower at 80,334.81, while the Nifty slipped 140.60 points to 24,273.80, dragged down by losses in tourism, realty, and banking stocks.