The Indian stock market fell sharply on Friday, with benchmark indices Sensex and Nifty falling around 1% each as soaring crude oil prices, surging bond yields and other factors spooked investors.Sensex dropped over 740 points to 74,160 while Nifty 50 fell 264 points to 23,231 during Friday's session. The losses wiped off more than Rs 5 lakh crore from the total market capitalisation of all companies listed on BSE within minutes from opening, dragging it down to Rs 478 lakh crore.M&M, Bajaj Finance, IndiGo, Tata Steel, UltraTech Cement and Axis Bank shares dropped around 2% each to lead losses on Sensex, while L&T, Eternal, Kotak Mahindra Bank, Titan, Sun Pharma and HDFC Bank shares fell over 1% each. Bucking the trend, Tech Mahindra and Infosys shares gained up to 1%.Broader markets plunged deeper, with Nifty Midcap 100 and Nifty Smallcap 100 indices falling 1.3% each. This came as India VIX, which measures market volatility, jumped more than 6% to cross 12.5.All sectoral indices traded in the red, with Nifty Realty crashing more than 3.5% and Nifty Metal plunging around 3%. Nifty Auto, Nifty Financial Services, Nifty Consumer Durables and several other indices traded 1-2% lower. The overall market breadth turned sharply negative, with NSE seeing 2,389 declines against 511 advances, while 88 stocks remained unchanged.Here are the key factors pushing the market down today:1) Iran-US conflict escalatesThe conflict between Iran and the US sharply escalated after Iran-aligned Houthis seized control of Yemen's port of Mocha on Thursday. US President Donald Trump warned that the country may hit Iran's Pickaxe Mountain, located near its heavily damaged Natanz uranium enrichment facility, and ⁠said the war would likely last beyond the November midterm elections.Iran meanwhile said it had attacked 10 ships near the strait on Wednesday, after the US hit five Iranian oil tankers. Iran's Islamic Revolutionary Guard Corps said it would escalate its response to any further attacks.2) Oil prices soar to multi-month highsAs a result of the fresh escalations in the Middle East conflict, oil prices surged as the biggest spike in attacks on shipping since the Iran war began hiked worries among traders about further disruptions to already tight supplies.Brent crude futures hit their highest level since May, rising more than 6% to cross $108 per barrel, while US WTI crude futures crossed $100 per barrel for the first time since May. "With prospects for a definitive resolution to the Iran conflict dimmed and Brent crude prices recently topping $100 for the first time since July, crude oil markets are now settling into a prolonged new normal where disruption risk is persistent, not episodic," Reuters quoted a new analysis by S&P Global Energy as saying.3) Bond yields surgeThe 10-year US Treasury yield surged to 4.97%, the highest level since late 2023. Investors now worry if the bond yield crosses the key 5% mark, a level briefly breached three years ago. The yields on 30-year US Treasury notes also hit their highest levels since 2007 at 5.38%, with the ​selloff in bonds spreading across the globe. Analysts have pointed out that if the yield on 10-year notes crosses the key 5% mark, it can trigger a sharper selloff across global markets. “A correction in global equity market is likely, but the timing is hard to predict,” said V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.Indian 10-year bond yields also joined the rally, with ⁠the ⁠benchmark 10-year bond ​yield surpassing 7% to ​a more than three-month high. Rising bond yields typically make the debt market more attractive to investors, which often leads to a downturn in the equity market.More to come...