The US military for its part had said it was responding to an Iranian attack targeting an American warship, the second such incident in less than a week.
Iran and Oman have for weeks been discussing the future of navigation through the waterway, with Tehran saying progress had been made to agree a temporary shipping route.
IT stocks were among the biggest losers, with the Nifty IT index declining around 2 per cent, as stronger US employment data boosted expectations of tighter monetary policy.
The U.S. has been introducing new measures to increase the economic pain on Iran after negotiations collapsed and no end to the intermittent fighting appears in sight.
Since a ceasefire went into effect between Israel and Hezbollah more than two months ago, fighting has subsided in much of Lebanon but low-level skirmishes and Israeli strikes continue.
The White House posted a map marking the Gulf waterway “Trump Strait” amid his claim of US sovereignty over the strait, which Tehran has effectively shut for six months.
