The Indian stock market slipped into the deep red on Wednesday, with Sensex and Nifty falling around 1% briefly before recovering some losses as escalating US-Iran tensions, soaring oil prices and other factors spooked investors. After opening, Sensex dropped over 750 points to fall below 76,200 while Nifty 50 plunged over 200 points to slip below 23,800 level in the morning.

The sharp drop in the stock market wiped off nearly Rs 5 lakh crore from the total market capitalisation of BSE within minutes from opening, dragging it down to Rs 488 lakh crore. The market however recovered some losses following the closing auction session (CAS), with Sensex closing 374 points lower at 76,570 and Nifty 50 ending 141 points lower at 23,914 on Wednesday.

Here's how analysts read the market pulseThe deepening global bond rout, amid escalating West Asia tensions and bets that central banks will need to tighten monetary policy, has gripped investor sentiment in fear, said Vinod Nair, Head of Research at Geojit Investments. Tracking negative global cues, domestic equities saw volatile trade, with mid-caps bearing the brunt, he noted.

Sectorally, while auto and IT stocks dragged markets down, gains in upstream oil & gas on realisation bets amid rising crude, alongside value buying in banking stocks, helped the market rec over from its intraday lows, the analyst added. -Iran clashes against signs of strength in the AI trade.

-Iran exchange ⁠of fire since ⁠July fueled fears of a broader regional conflict. But the AI growth engine has helped sentiment, and investors are betting that a modest dose of macroeconomic uncertainty would not be enough to derail the tech trade.

3%, ⁠after sharper losses in Asia. 18 a barrel.

Tech viewFollowing a gap-down start, Nifty 50 recovered during the day, though it ended the session with a loss, said Rupak De, Senior Technical Analyst at LKP Securities. He noted that the benchmark index has broken down from a rising channel amid sustained selling pressure in the market.

The weakness prevailed throughout the day, despite an intraday recovery. “The current bearish sentiment is likely to continue in the short term, and a sell-on-rise strategy may remain the preferred approach as long as the index remains below 24,000.

On the lower end, the correction may extend towards 23,700–23,730,” according to the analyst. Most active stocks in terms of turnoverIFCI (Rs 4,104 crore), HDFC Bank (Rs 2,595 crore), BSE (Rs 2,070 crore), Reliance Industries (Rs 1,767 crore), Coal India (Rs 1,424 crore), SBI (Rs 1,416 crore), and Kalyan Jewellers (Rs 1,228 crore) were among the most active stocks on NSE in value terms.