India VIX Jumps Nearly 5% on Middle East Tensions, Yet Stays Below June Peak

The India VIX, a benchmark gauge of market volatility, surged up to 5% on June 23, 2025, as fresh geopolitical concerns in the Middle East rattled investor sentiment. Still, volatility levels remained below the June 13 high, which followed Israeli military strikes in Iran.

The volatility spike followed an aggressive response by the US—attacking multiple Iranian nuclear sites and openly warning of further action, including possible regime change. Equities responded swiftly: the Nifty 50 index fell nearly 1%, slipping below the 25,000 mark, dragged down by declines in IT, banking, and oil‑sensitive sectors.

Crude futures also surged, approaching $80/barrel, amid fears Iran could disrupt Gulf shipping via the Strait of Hormuz. This added pressure to sectors exposed to higher oil costs, contributing to elevated market volatility.

Despite recent volatility spikes, the India VIX remains lower than earlier June highs—for instance, on June 13 it closed at 15.08, following Israel’s strike on Iranian nuclear sites. On a year-to-date basis, the VIX sits around 2% lower, showing a cooling after earlier shock events like US‑India tariff developments and counter‑terror strikes in India.

What experts say:

Nilesh Shah of Kotak AMC notes that while domestic factors continue to influence markets, heightened geopolitical tensions are adding an extra layer of uncertainty. He suggests investors remain focused on India’s underlying growth story.

Shrikant Chouhan, Kotak Securities’ head of equity research, forecasts that the Nifty is likely to hold between the 24,700–24,900 range, with a breakout above 24,900 potentially driving the index to 25,050. A drop below 24,700, however, could trigger further pressure toward the 24,500–24,475 zone.