Fear gauge shows India stock strain stays as Iran shock eases in Asia

STOCK-MARKET VOLATILITY IN India is staying elevated unlike in the rest of Asia, signalling a deeper investor unease about the nation’s energy exposure, high valuations and renewed focus on corporate governance troubles.

- ABHISHEK VISHNOI

India’s volatility gauge remains nearits March 9 peak, which was the highest since June 2024. Similar measures for Japan and South Korea, countries that rely heavily on fuel shipped through the Strait of Hormuz, have dropped from their respective Iran war-driven highs. The Cboe Volatility Index has also eased.

The divergence suggests India’s risk premium is turning stickier with the energy shock hitting the economy. Even before the conflict, India faced high valuations, the risk of AI disruption without notable chipmakers, and currency weakness. The selloff has pushed its stocks benchmark near levels last seen during the market turmoil after the US tariff rollout a year ago, just as governance concerns erupted at HDFC Bank.