Airline, OMCs, paint and tyre stocks fall up to 5% as Brent nears $110; SpiceJet, HPCL among major losers

Fresh updates from the financial markets indicate that Shares of airlines, oil marketing firms (OMCs), paint and tyre makers declined on Friday as crude prices extended their surge, with Brent crude approaching $110 a barrel amid escalating supply concerns in the Middle East. SpiceJet, Hindustan Petroleum Corporation (HPCL) and InterGlobe Aviation (IndiGo) were among the major losers, falling around 2-5 percent in early session.

SpiceJet shares eased 4.6 percent to Rs 8.48, while HPCL declined 3.1 percent to Rs 341.85. IndiGo, India's largest airline, declined 1.7 percent to Rs 4,861.50.

Other oil-sensitive stocks additionally traded softer. Bharat Petroleum Corporation (BPCL) declined 1.9 percent to Rs 297.30, while Indian Oil Corporation (IOC) declined 0.5 percent to Rs 134.23.

Paint and tyre stocks, which are additionally sensitive to crude prices because several petroleum derivatives are used as raw materials, came under pressure. Kansai Nerolac Paints declined 1.8 percent, Asian Paints declined 1.3 percent and Berger Paints eased 0.3 percent. Apollo Tyres, JK Tyre & Industries and CEAT declined around 1-1.6 percent.

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The declines came as Brent crude futures rose 1 percent to $108.68 a barrel in early Asian trade, after surging more than 6 percent on Thursday. US West Texas Intermediate crude advanced 1 percent to $103.45 a barrel.

Crude prices have advanced as escalating attacks along key Middle Eastern shipping routes heightened concerns over prolonged disruptions to global supplies. Iran-aligned Houthis seized control of Yemen's port of Mocha on Thursday, posing a further threat to Red Sea traffic, while restrictions through the Strait of Hormuz and attacks on tankers have further noted to supply concerns.

Elevated crude prices tend to weigh on airlines because aviation turbine fuel is a major operating cost, while refiners and fuel retailers can face pressure if increases in international prices are not fully passed on to consumers. Paint and tyre manufacturers are exposed through crude-linked input costs.

That stated, upstream oil producers moved in the opposite direction as elevated crude prices potentially improve realisations. ONGC shares advanced 2.2 percent to Rs 242.57, while Oil India rose 0.9 percent to Rs 505.

The broader Indian equity market was additionally under heavy selling pressure. At 9:25 am, the Sensex was down 633 points, or 0.85 percent, at 74,269, while the Nifty 50 declined 213 points, or 0.91 percent, to 23,265. Market breadth was sharply negative, with 2,227 shares declining against 719 advances.