Indian benchmark indices Sensex and Nifty plunged significantly, with the Sensex tumbling 719.08 points, as escalating West Asian tensions, a sharp spike in crude oil prices, and a global technology stock sell-off rattled investor confidence.
Photograph: Francis Mascarenhas/Reuters
Key Points
- Indian benchmark indices Sensex and Nifty slumped significantly, extending losses for the second consecutive session.
- The decline was primarily triggered by escalating tensions in West Asia, which pushed Brent crude oil prices up by 4.10 per cent to USD 96.91 per barrel.
- A global sell-off in technology stocks, with investors questioning the sustainability of the AI-led rally, also contributed to the market downturn.
- Foreign Institutional Investors (FIIs) offloaded equities worth Rs 8,776.25 crore on Friday, indicating a cautious sentiment.
- Major Asian and US markets also ended significantly lower, reflecting a broad-based negative global sentiment.
Benchmark indices Sensex and Nifty slumped on Monday, tracking a sharp decline in global equities and a fresh spike in crude oil prices, amid flaring tensions in West Asia.
Extending losses for the second straight session, the 30-share BSE Sensex tumbled 719.08 points, or 0.97 per cent, to settle at 73,524.26. During the day, it dived 924.4 points, or 1.24 per cent, to 73,318.94.
The 50-share NSE Nifty settled 243.70 points, or 1.04 per cent, lower at 23,123. In intra-day trade, the benchmark lost 296.55 points, or 1.26 per cent, to 23,070.15.
Top Laggards and Gainers
Among the Sensex constituents, Eternal, Mahindra & Mahindra, Trent, InterGlobe Aviation, Reliance Industries and Tata Consultancy Services were among the biggest laggards.
Power Grid, Tech Mahindra, Bharat Electronics and Bharti Airtel were among the winners.
Brent crude, the global oil benchmark, jumped 4.10 per cent to USD 96.91 per barrel.
Global Market Performance
In Asian markets, South Korea’s Kospi, Japan’s Nikkei 225 index, Shanghai’s SSE Composite index and Hong Kong’s Hang Seng ended significantly lower. The Kospi plunged 8.29 per cent, while the Nikkei 225 index dropped 3.85 per cent.
Markets in Europe were trading in the negative territory.
US markets ended sharply lower on Friday. The Nasdaq Composite tanked 4.18 per cent, while the S&P 500 dropped 2.64 per cent and the Dow Jones Industrial Average declined 1.35 per cent.
Expert Analysis on Market Drivers
“Global sentiment has weakened amid a flare-up of tensions in the Middle East, pushing crude towards USD 100/bbl. Simultaneously, global technology stocks have witnessed a sell-off, as investors begin to question the sustainability of the AI-led rally.
“Selling pressure was also seen in semiconductor-heavy indices, showing early signs of valuation fatigue and positioning unwind, although it is premature to classify this as a trend reversal,” Vinod Nair, Head of Research, Geojit Investments Limited, said.
Meanwhile, Foreign Institutional Investors (FIIs) offloaded equities worth Rs 8,776.25 crore on Friday, according to exchange data.
“Global markets broadly traded in the red after Israel and Iran exchanged missile strikes for the first time since the ceasefire announcement, raising concerns that recent diplomatic progress could quickly unravel.
“The renewed escalation, which came despite calls for restraint from the United States, heightened fears of a prolonged regional conflict and a further disruption to global energy supplies,” Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm, said.
At the same time, signs of fatigue in the global AI and technology rally added to investor caution, he added.
