Stock market shock: Sensex crashes over 1,900 points as oil prices surge and global tensions rise
The fall not triggered by a single factor but by a mix of global and domestic concerns
PTC Web Desk: Indian stock markets witnessed a sharp decline on Thursday morning, breaking a three-day winning streak, as rising crude oil prices and weak global cues dented investor sentiment. Both benchmark indices opened significantly lower, reflecting widespread selling pressure across sectors.
The 30-share BSE Sensex plunged as much as 1,953 points in early trade to touch 74,750, while the NSE Nifty slipped over 580 points to fall below the 23,200 mark. Within the first hour of trading, investors saw a massive erosion of wealth, with the total market capitalisation of BSE-listed firms dropping by nearly Rs 7.6 trillion.
The fall was not triggered by a single factor but by a mix of global and domestic concerns. One of the biggest reasons behind the sell-off is the sharp rise in crude oil prices. Brent crude climbed nearly 4 per cent to cross $110 per barrel, following fresh geopolitical tensions in the Middle East. For India, which relies heavily on oil imports, higher crude prices increase inflation and put pressure on company earnings.
Adding to the concerns, ongoing tensions in key energy-producing regions like Iran and Qatar have raised fears of supply disruptions. This uncertainty has made investors cautious and triggered selling across markets.
Banking and financial stocks led the decline. HDFC Bank was among the top losers, falling more than 3 per cent after reports of the sudden resignation of its chairman citing ethical concerns. Other major laggards included Larsen & Toubro, Axis Bank, Mahindra & Mahindra, Bajaj Finance, and Eternal Ltd. On the other hand, defensive stocks like NTPC and Power Grid managed to stay in the green.
Foreign investors also continued their selling spree, further pressuring the markets. In just a few trading sessions this month, foreign portfolio investors have pulled out significant funds from Indian equities, weakening market sentiment and adding volatility.
Global markets mirrored the weakness seen in India. Asian indices such as Japan’s Nikkei 225, South Korea’s Kospi, China’s Shanghai Composite, and Hong Kong’s Hang Seng were all trading lower. The negative trend followed a subdued session on Wall Street, where major US indices ended in the red.
Another factor weighing on markets is the US Federal Reserve’s stance on interest rates. The Fed has kept rates unchanged but indicated that rate cuts may not happen anytime soon. This has reduced liquidity support for emerging markets like India, making them less attractive to global investors.
Experts believe that the current fall is largely driven by external factors rather than domestic weaknesses. However, the sharp reaction shows how sensitive markets are to global developments. If oil prices stabilise and geopolitical tensions ease, markets may recover. Until then, volatility is expected to remain high.