Indian stock market witnessed a sharp sell-off on Monday, with the Sensex and Nifty plunging over 1,100 points and the crucial 23,000 mark respectively. Rising crude oil prices, geopolitical tensions and higher global bond yields weighed on investor sentiment, triggering widespread selling across sectors.
Key highlights
- Sensex plunged 1,124 points and Nifty fell below 23,000 as crude oil prices and geopolitical tensions weighed on sentiment.
- Investors lost Rs 8.77 lakh crore as broad-based selling dragged midcap, smallcap and major sectoral indices lower.
The BSE Sensex declined 1,124 points, or 1.52%, to close at 72,771.72. The NSE Nifty 50 fell 360 points, or 1.56%, to settle at 22,780.25.
The sell-off resulted in a loss of Rs 8.77 lakh crore to investors. The overall market cap of the BSE-listed companies fell by Rs 474.47 lakh crore from the previous week Friday's closing level of Rs 483.25 lakh crore.
Sensex, Nifty Extend Losses as Midcap and Smallcap Stocks Decline
The selling pressure spread to other indices as well, with midcap and smallcap stocks trading heavily on their downside. The Nifty Midcap 100 declined 1.63% to 59,914.20, while the Nifty Smallcap 100 fell 1.85% to 19,351.10.
India VIX, which measures investor nervousness, rose to 13.69 from 12.54 on the previous session during the day leading to a rise in stock market volatility.
The sell-off was across the Sensex constituents with 29 of the 30 stocks closing in the negative. Infosys was the only stock that ended up in positive territory, up by 0.20%.
Power Grid, Larsen & Toubro (L&T), HDFC Bank, Hindustan Unilever and Reliance Industries were the top losers with the shares down 2.81%, 2.62%, 2.30%, 2.27% and 2.24% respectively. Other banks such as State Bank of India, ICICI Bank and Adani Ports dipped over 1.9 per cent each.
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PSU Banks, Realty and Metal Stocks Lead Sectoral Declines
Sectoral indices too were hit, with the public sector banks, realty, metals, oil and gas, and financial services among the worst hit.
The Nifty PSU Bank index shed 3.24%, the Nifty Realty and the Nifty Metal indices dipped by 2.12% and 1.78%, respectively. The broad-based drop was across all areas as the world economic and financial situation was seen as worrisome.
Why Did the Stock Market Fall Today?
Rising crude oil prices, geopolitical tensions in West Asia and higher US bond yields were among the key factors behind Monday’s stock market decline.
Brent crude rose above $106 a barrel amid concerns over the Strait of Hormuz, raising worries about India’s import bill, inflation and currency stability. The Indian rupee weakened to around Rs 95.95 per US dollar, while the 10-year government bond yield reached a two-year high.
Vinod Nair, Head of Research at Geojit Investments, said the market came under pressure as it breached a key psychological support level amid deteriorating global macroeconomic conditions. He added that the US rejection of a ceasefire proposal had heightened concerns about prolonged tensions in West Asia and potential disruptions to energy supplies.
Higher US bond yields have also narrowed the India-US yield differential, potentially weighing on foreign investment flows and keeping market sentiment cautious.
Pranay Aggarwal, Director and CEO of Stoxkart, attributed the broader sell-off to rising crude prices, a weaker rupee and higher sovereign bond yields. Vikram Kasat, Chief Business Officer – Advisory and Dealing at PL Capital, said the decline reflected a combination of global macroeconomic pressures rather than purely domestic weakness.
With crude prices, bond yields and geopolitical developments remaining key concerns, investors will continue to monitor global cues and their impact on domestic equities.
