India-Pak tensions: Fear index India VIX continues to rise, jumps 5% today

Domestic benchmarks registered a sharp correction in Friday's early trade as tensions between India and Pakistan continued to escalate. The 30-share BSE Sensex pack slumped 787 points or 0.98 per cent to close at 79,548 and the broader NSE Nifty index moved 255 points or 1.05 per cent to end at 24,018. Broader indices (mid- and small-cap) tanked up to 1.80 per cent.

India VIX, a fear index which measures market volatility, surged 4.65 per cent to 21.99, as per NSE data. The index measures expected market volatility based on Nifty50 index options contracts. A rise in India VIX indicates that investors anticipate higher uncertainty or risk over the short term (30 days). When the volatility index rises, stocks usually tend to fluctuate, making it difficult to predict future market movements.

Investor wealth, as suggested by the BSE market capitalisation (m-cap), fell around Rs 4.5 lakh crore to Rs 414.03 lakh crore compared with a valuation of Rs 418.50 lakh crore recorded in the previous session. Frontline stocks such as HDFC Bank, ICICI Bank, Reliance Industries Ltd, PowerGrid, Infosys, Bharti Airtel, ITC, HUL, Kotak Mahindra Bank, TCS and Bajaj Finance contributed to the fall today.

In a separate development, foreign institutional investors extended their buying spree to the 16th straight session in the Indian stock market. FIIs bought equities worth Rs 9,648 crore in May 2025 so far. Siddhartha Khemka of MOFSL said foreign investors have turned net buyers with a month-to-date inflow of Rs 9,648 crore.

NSE data showed that FIIs bought Rs 2,007.96 crore worth of shares on a net basis during the previous session, while domestic institutional investors (DIIs) sold Rs 596.25 crore worth of equity.

Meanwhile, India said over 50 drones were successfully neutralised during a large-scale counter-drone operation conducted by Indian Army air defence units in Udhampur, Samba, Jammu, Akhnoor, Nagrota and Pathankot.