Benchmark equity indices came under renewed selling pressure on Monday, giving up their early gains and extending the ongoing corrective trend as Brent crude prices surged to $106 per barrel amid escalating tensions in the Middle East.

Despite a sharp rebound in the Indian rupee, which appreciated 1% to 95.78 against the US dollar, investor sentiment in the equity market remained subdued.

After opening on a positive note, the Sensex and Nifty reversed course and gradually moved lower as the session progressed. The Sensex finally closed at 71,924.68, down 547.65 points, or 0.76%, while the Nifty settled at 22,363.35, down 157.10 points, or 0.70%. Both indices ended near their respective intraday lows.

“Markets continued to feel the jitters from the raging conflict in the Middle East, which prompted investors to further reduce their equity exposure,” said Ankur Punj, Managing Director, Equirus Wealth.

Despite the rupee’s sharp recovery against the dollar, a bearish sentiment persisted in the equity market amid weak cues from Asian markets and sustained foreign fund outflows from domestic equities, Punj added.

“Elevated global bond yields, escalating geopolitical tensions and persistent foreign fund outflows continued to act as major headwinds,” said Ajit Mishra, SVP – Research, Religare Broking.

The tendency for markets to face selling pressure on every rebound highlights the fragile nature of the recent recovery and the lack of sustained buying conviction at higher levels, Mishra added.

Market breadth was marginally positive, with 2,292 stocks advancing against 2,163 declining on the BSE.

Sectoral performance remained mixed, with IT, FMCG and banking stocks among the major laggards. In contrast, realty and auto stocks displayed relative resilience and ended in positive territory.

The broader market also witnessed mixed trends, with the Nifty Smallcap 100 index gaining 1.42%, while the Nifty Midcap 100 index ended nearly flat, up 0.08%.

ITC, Tech Mahindra, HUL, L&T and SBI were the top Sensex losers, while BEL, M&M, Kotak Mahindra Bank, HCL Technologies and Bajaj Finance were the top gainers.

Investors’ wealth rose marginally by Rs 13,518 crore to Rs 465.45 lakh crore.

Across Asia, South Korea and Indonesia were the top losers, declining 3.65% and 2.59%, respectively. In contrast, the Philippines and Malaysia were the top gainers, rising 0.74% and 0.59%, respectively.