Shares of Jammu and Kashmir Bank plunged nearly 10% on Wednesday, while airline and hotel stocks remained under stress, a day after 26 people got killed in a terror attack in Pahalgam in Jammu and Kashmir's Anantnag district. Meanwhile, the Indian equity market extended their rally for the seventh consecutive session on April 23, albeit upmove were restricted as the tragic Pahalgam attack dented sentiments. Going forward, investor will keep a close eye on the government’s response to the terrorist attack, and any form of retaliation could spook sentiments.

Prime Minister Narendra Modi has strongly condemned the terror attack in Pahalgam, saying that those behind this heinous act will not be spared. “I strongly condemn the terror attack in Pahalgam, Jammu and Kashmir. Condolences to those who have lost their loved ones. I pray that the injured recover at the earliest. All possible assistance is being provided to those affected. Those behind this heinous act will be brought to justice...they will not be spared! Their evil agenda will never succeed. Our resolve to fight terrorism is unshakable and it will get even stronger,” he said in a X post.

Snapping five sessions gaining streak, shares of J&K Bank declined 9.5% to hit an intraday low of ₹102.50 on the BSE. In the past five trading days, the banking stock gained over 24%.

On the other hand, domestic aviation stocks - IndiGo and SpiceJet - were also reeling under pressure. While IndiGo’s parent InterGlobe Aviation shares dropped as much as 1%, SpiceJet stock slide 2.7% during the trade so far. Tata Group-owned Air India and the country's largest airline IndiGo has announced additional flights to Srinagar in the aftermath of a deadly terrorist attack in a picturesque meadow in Kashmir’s resort town of Pahalgam. Both airlines are offering free cancellations to passengers who have booked their flight to Srinagar for bookings up to April 30, 2025.

In a similar trend, hotel stocks were also flashing in red in the aftermath of the terror attack of Jammu and Kashmir, which is one of the most popular tourist destinations in the country. The region has seen a surge in tourism, with record numbers of visitors during summer season, seeking its natural beauty and cooler climate, especially during heatwaves.

As per report, hotel cancellations have surged in key tourist destinations regions, including Gulmarg (known for skiing), Pahalgam (a picturesque valley), and Katra (the base for Vaishno Devi pilgrimage), following the attack.

Weighed down by the development, shares of ITC Hotels, Lemon Tree Hotels, TAJ GVK, Indian Hotels, Chalet Hotels, Mahindra Holidays, Apeejay Surrendra Park Hotels, and EaseMyTrip declined in the range of 1-3%.

“To ensure flexibility, we have extended free change and cancellation waivers for all bookings made on or before April 22, applicable for travel up to April 30. Additionally, we are coordinating closely with airlines and local authorities and will share regular updates. Your safety and convenience remain our top priorities," said Nishant Pitti, Chairman and Founder, EaseMyTrip.

Meanwhile, the equity benchmarks Sensex and Nifty50 continued to trade in positive terrain, rising up to 0.5%. The BSE Sensex reclaimed crucial level of 80,000, while the Nifty inched close to 24,300 level.

"Terror attacks while succeeding in taking precious human lives cannot succeed in even marginally impacting our economy and markets. Pakistan’s political instability and basket case economy cannot do any damage to Indian economy and markets. Markets may send this message today and the fundamental factors are favourable,” said VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.

Technically the market might move into an overbought territory soon inviting some profit booking. Investors should remain invested in high quality largecaps, he said.

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