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Indian equity markets witnessed a sharp sell-off on Wednesday, with the Sensex plunging 1,677 points (2.2%) to close at 76,504, while the Nifty 50 dropped 517 points (2.1%) to end at 23,882. It marked the benchmark indices’ steepest single-day decline in more than two months.
The market downturn came after US President Donald Trump declared that the interim agreement with Iran was “over” following attacks on commercial vessels in the Strait of Hormuz.
Key Highlights
- Sensex: Down 1,677 points (2.2%) to 76,504
- Nifty 50: Down 517 points (2.1%) to 23,882
- Investor wealth eroded: Over ₹5.8 lakh crore
- Crude oil: Jumped nearly 7% to around $79.1 per barrel
Why Did Markets Fall?
Trump’s remarks intensified concerns over escalating geopolitical tensions in the Middle East, raising fears of disruptions to global oil supplies. The sharp rise in crude oil prices weighed heavily on investor sentiment, prompting widespread selling across global equity markets.
Higher crude prices are particularly concerning for India, which imports a significant portion of its oil requirements. Rising energy costs can increase inflationary pressures, widen the trade deficit and impact corporate profitability.
Broad-Based Selling
The decline was widespread:
- 3,211 stocks declined on the BSE.
- Only 1,070 stocks advanced.
- Every Sensex constituent ended in negative territory.
Among the biggest losers were:
- InterGlobe Aviation (IndiGo)
- Maruti Suzuki
- Hindustan Unilever
- Bajaj Finance
- Kotak Mahindra Bank
- Mahindra & Mahindra
Mid-cap and small-cap stocks also declined sharply, with the BSE Midcap Index falling 2.1% and the Smallcap Index losing 1.6%.
Sector Performance
All major sectoral indices ended in the red:
- Services: -3.2%
- PSU Banks: -2.8%
- FMCG: -2.5%
- Financial Services: Around -2.5%
Global Markets Under Pressure
The weakness extended across global markets:
- Nikkei 225: -2.1%
- KOSPI: -5.4%
- European markets traded lower.
- US markets also came under pressure in early trade.
Expert View
According to market experts, investors are expected to remain cautious until there is greater clarity on geopolitical developments and oil prices.
Analysts also noted a sharp rise in market volatility, with the India VIX climbing significantly, indicating heightened uncertainty in the near term.