BENGALURU: Indian shares fell on Monday, dragged by a surge in oil prices due to a military conflict in the Middle East and higher US interest rate concerns. The NSE Nifty 50 index closed 0.72% lower at 19,512.35, while the S&P BSE Sensex fell 0.73% to 65,512.39.

All the 13 major sectoral indexes logged losses. High weightage banks and oil & gas lost over 1% each while public sector banks shed 3.09%.

“There is a prevailing concern within global financial markets regarding potential protracted conflict between Israel and Hamas,” Jayden Ong, senior market analyst for Asia Pacific at Vantage said, adding that rising crude prices could contribute to elevated inflation.

The more domestically focussed small- and mid-caps underperformed the blue-chips, losing between 1.3% and 1.8%.

“We find better value in top large-cap stocks and expect them to outperform small- and mid-caps,” analysts at Kotak Institutional Equities wrote in a note.

“The current euphoria in mid- and small-cap stocks may fade over time and the valuations will realign with their fundamentals.”