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Indian benchmark indices, Sensex and Nifty, witnessed a sharp decline, with the Sensex plummeting 778 points and the Nifty hitting a five-month low, as surging crude oil prices, geopolitical tensions, and global interest rate hike fears rattled investor sentiment.
Photograph: Hemanshi Kamani/Reuters
Key Points
- The BSE Sensex tumbled 777.94 points (1.04%) to 74,003.82, a three-month low, while the NSE Nifty dropped 279.50 points (1.19%) to 23,118.60, its lowest since April 6.
- Surging Brent crude oil prices, which jumped 1.89% to $107.7 per barrel, and rising global bond yields were key factors contributing to the market decline.
- Investor caution ahead of central bank meetings this week, with expectations of further policy tightening, exacerbated negative sentiment.
- IT stocks, including HCL Tech, Infosys, and TCS, bucked the trend and outperformed, driven by comments suggesting slower AI development easing concerns over disruption.
- Foreign Institutional Investors (FIIs) continued to offload equities, selling Rs 930.90 crore on Friday, contributing to persistent foreign outflows.
Benchmark Sensex tanked 778 points while the broader stock index Nifty closed at a five-month low on Tuesday amid surging oil prices, geopolitical tensions and weak trends in global markets.
The 30-share BSE Sensex tumbled 777.94 points, or 1.04 per cent, to settle at a three-month low of 74,003.82, dragged by losses in blue-chip banking, auto and oil & gas shares.
The index opened higher but lost steam in late-morning deals as selling gathered pace.
The barometer later tanked 787.73 points, or 1.05 per cent, to a day’s low of 73,994.03.
The 50-share NSE Nifty dropped 279.50 points, or 1.19 per cent, to end at 23,118.60, the lowest closing level since April 6.
Sectoral Performance and Global Cues
Among the 30 Sensex firms, Bharat Electronics tumbled 6 per cent. InterGlobe Aviation, Titan, Bajaj Finserv, Adani Ports, Mahindra & Mahindra and State Bank of India were also among the laggards.
HCL Tech jumped 3.98 per cent, Infosys climbed 3.64 per cent, Tech Mahindra was up 2.31 per cent, and Tata Consultancy Services (2.18 per cent) and HDFC Bank (1.27 per cent) also rose.
Brent crude, the global oil benchmark, jumped 1.89 per cent to $107.7 per barrel.
“Domestic markets remained under pressure, extending their recent correction as elevated crude oil prices and rising global bond yields weighed on sentiment.
“Investors stayed cautious ahead of key central bank meetings this week, with growing expectations of further policy tightening by major economies.
“Concerns about a prolonged high-interest-rate environment, particularly in the US, kept Treasury yields near multi-year highs and continued to dampen emerging market sentiment amid persistent foreign outflows,” Vinod Nair, Head of Research, Geojit Investments Limited, said.
IT stocks outperformed as comments suggesting slower AI development eased concerns over the rapid disruption of traditional IT services, Nair added.
International Market Trends
In Asian markets, South Korea’s Kospi, Japan’s Nikkei 225 index, Shanghai’s SSE Composite index and Hong Kong’s Hang Seng index ended lower.
“Indian equities suffered a sharp reversal on Tuesday, surrendering their opening gains as Brent crude hovered near $107.40 a barrel, US bond yields remained elevated and investors adopted a cautious stance ahead of the Federal Reserve’s policy decision,” Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, said.
The selling was broad-based, with information technology emerging as the only sector to finish in positive territory, he said, adding that selective buying in large technology exporters suggested that immediate concerns over AI-led disruption had eased, although the gains were insufficient to offset weakness across the rest of the market.
The domestic equity markets were closed on Monday on account of Ganesh Chaturthi.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 930.90 crore on Friday, according to exchange data.
