We woke up this Saturday morning to news that most of us had hoped would not come.
We woke up this Saturday morning to news that most of us had hoped would not come.
The United States and Israel launched coordinated military strikes on Iran. The operation has been named 'Operation Epic Fury'. Explosions were reported across Tehran. Iran has already retaliated with missiles aimed at northern Israel and US military bases in Qatar, Kuwait, the UAE, and Bahrain.
The Strait of Hormuz, through which nearly 20% of the world's oil passes, is now sitting right at the edge of an active conflict zone.
This is not a rumour. This is not a threat. It has happened.
And naturally, every investor and trader sitting at home this weekend is asking the same question.
What do I do on Monday?
What Happened and Why It Matters
This escalation did not come as a surprise to those who were tracking the situation closely.
In late January, President Trump warned Iran publicly on social media, describing a massive military armada heading toward the region. Weeks of nuclear negotiations in Geneva failed to produce an agreement. The US had already assembled F-22 stealth jets and warships at Israel's Ben Gurion airport. Iran refused to put its ballistic missile programme on the table.
On February 28, 2026 (today), the first strikes began.
Iran's supreme leader, Khamenei, was moved to a secure location. Iran launched retaliatory strikes not just at Israel but at US military assets across multiple Gulf nations. An Iranian official stated that all American and Israeli interests in the region are now legitimate targets.
Iran did not stop at Israel. In retaliation, Iranian missiles struck US military bases across the Gulf — targeting Al-Udeid Air Base in Qatar, Al-Salem Air Base in Kuwait, Al-Dhafra Air Base in the UAE, and the US Navy's 5th Fleet headquarters in Bahrain. UAE, Qatar, Kuwait and Iran have all closed their airspaces to civilian traffic. Saudi Arabia condemned the attacks and warned of grave consequences, expressing full solidarity with the affected nations.
A prolonged conflict here is not just a geopolitical story. It is an economic one. This is a regional war that touches India's economy at multiple points.
Source: https://www.aljazeera.com/news/2026/2/28/us-and-israel-attack-iran-what-we-know-so-far
Source: https://www.cnbc.com/2026/02/28/trump-us-military-iran-strikes-middle-east-oil.html
Why This Directly Touches Indian Markets
India is not at war. But we are very much affected.
Let me explain why.
- Crude oil: India imports nearly 85% of its crude oil. Any disruption to Persian Gulf supply routes means higher crude prices, a wider current account deficit, and more pressure on the rupee.
- FII outflows: When global uncertainty spikes, foreign investors move money out of emerging markets. India is not immune to that outflow even when our own fundamentals are sound.
- Rupee: The rupee tends to weaken when the dollar strengthens in risk-off environments. A weaker rupee adds to import costs, especially oil.
Nifty 50 — Levels to Watch
Nifty closed Friday at 25,178. Even before this weekend's news, the chart showed a pattern of lower highs and lower lows since budget day. The geopolitical shock adds a fresh layer of uncertainty on top of that.
Here are the levels that matter.
- Resistance at 25,640 : First meaningful level on the upside. A close above this changes the tone.
- Immediate Support at 25,050 : This is the key level. Two consecutive closing below this can trigger further selling.
- Next Support at 24,810 and 24,725 : These come into play if 25,050 breaks.
- Strong Support at 24,620 : A meaningful base where I would expect serious buying to return.
A gap down open on Monday is possible. But remember, a gap down and a breakdown are two different things. Watch the closing price, not the opening price.
Banknifty — Levels to Watch
Banknifty closed at 60,259. It has been the stronger index compared to Nifty in recent weeks. PSU banking stocks will be the key segment to watch here.
- Resistance at 61,290 : Reclaiming this level would restore confidence.
- Immediate Support at 60,110 : First support below current levels.
- Next Supports at 59,840 and 59,340 : These levels come in if selling accelerates.
Banknifty has shown resilience before. PSU Banks are domestically focused and relatively insulated from global crude shocks. I would not write them off quickly.
The 4 Day Week Factor
With Tuesday being a market holiday, the week has only four trading sessions. Monday, Wednesday, Thursday, and Friday.
This matters because institutional positioning gets compressed. Moves can be sharper in both directions. Here is how I see the week playing out.
- Monday absorbs the full weight of the weekend news. Expect volatility and wide swings in the first hour.
- Wednesday is when the market will start to settle as traders assess global overnight reactions and Iran's next steps.
- By Thursday, a clearer direction for the week should emerge. Either a recovery or a continuation of the selling.
- Friday will reflect where smart money has chosen to position heading into the next weekend.
Do not over-leverage going into Monday. A gap down followed by a sharp recovery is just as likely as a sustained fall. Both can happen fast.
Sectors to Watch This Week
In volatile environments, where you are invested matters as much as how you are invested. Here is my view on the sectors to focus on.
- Oil and Gas: With Hormuz under threat, crude prices are rising. This directly benefits upstream PSU majors. Keep an eye on this space.
- Defence: Every time global conflict escalates, India's defence indigenisation story gets louder. HAL, BEL, Mazagon Dock, and related names get fresh interest.
- PSU Banks: PSU Banks are domestically focused businesses. They are relatively protected from global crude volatility. The chart structure of Banknifty supports this view.
- Pharma: A classic safe heaven during uncertainty. Export-oriented pharma names also benefit from rupee depreciation.
- Metals: Global metal prices react to supply chain anxiety in conflict situations. Watch LME cues on Monday morning before taking a view.
How Should You Approach the Week?
For Traders
- Wait for the first 30 minutes on Monday. Do not be in a hurry to take positions at the open.
- Let the market show you a direction before committing. Reactive trades at the open in high volatility rarely end well.
- Swing trades in Banknifty and midcap stocks with strong technical setups remain the best opportunity once the initial volatility settles.
- Keep stop losses tighter than usual. Geopolitical events can create false breakouts that reverse sharply.
For Investors
- This is not the time to panic-sell quality holdings. Wars create noise. Compounding creates wealth. These two things work on very different timelines.
- If you have been holding cash and waiting for an opportunity, this week may give you better entry prices in quality names. Markets that fall on geopolitical events historically recover faster than those that fall on fundamental deterioration.
- The earnings season just concluded. Use this weekend to go through management commentaries and guidance. The best investments are made when fear peaks and fundamentals are intact.
My Closing Thought
I have been watching markets for a while now.
The headlines that feel the most frightening rarely produce the outcomes we fear most. Markets have survived wars, recessions, pandemics, and political crises. They will survive this, too.
What separates investors who build wealth through difficult periods from those who don't is not just prediction. It is preparation. Know your levels, know your risk, and have a plan for both scenarios before Monday morning.
"In volatile environments, disciplined investors rely on data and predefined frameworks rather than reacting to headlines or emotionally charged narratives."
If you found this useful, please share it with your fellow traders, investors, and friends who are trying to make sense of a difficult weekend.
Stay data-driven. Stay disciplined. And as always, Happy Investing!
Kushal Lakhani
VK Advisors
Disclaimer
This blog is for educational and informational purposes only and does not constitute investment advice. The views expressed are personal and based on publicly available information. Please consult your financial advisor before making any investment decisions. SEBI Registration No: INH000005661.