Stock market crash: Following the escalation of the US-Iran war and rising crude oil prices, the Indian stock market opened lower in early-morning trading on Wednesday. The key benchmark indices further extended their gap-down opening and crashed by over 0.50% within a few minutes of the Opening Bell.
The Nifty 50 index opened lower at 24,259 and touched an intraday low of 24,207, logging an intraday loss of 191 points or 0.78%. The BSE Sensex had a gap-down opening at 77,816. The 30-stock index touched an intraday low of 77,555, logging an intraday loss of 625 points or 0.80%. Likewise, the Bank Nifty index opened downside at 57,918 and touched an intraday low of 57,706, recording an intraday loss of 494 or 0.85%.
According to data available on the BSE, in this sell-off on Dalal Street, BSE-listed stocks have lost ₹2 lakh crore in market capitalisation. The BSE-listed stocks had ended on Tuesday with a market valuation of ₹4,80,20,223 crore or ₹480 lakh crore, which has now slipped to ₹4,78,14,494 crore or ₹478 lakh crore.
Thirteen of the 16 major sectors logged losses. The broader small-caps and mid-caps fell 0.3% each.
The oil and gas index fell 1.5%, while crude-sensitive auto and FMCG indexes lost 1% and 1.5%, respectively. Oil marketing companies BPCL, HPCL and Indian Oil, paint makers such as Asian Paints, airline operator IndiGo and tyre makers fell as rising crude prices stoked margin concerns. Oil producers ONGC and Oil India, which typically benefit from higher crude prices, gained about 0.5% each.
Asian Paints, IndiGo and ITC were among the top percentage losers on the Nifty 50.
Pharmaceutical and healthcare shares both rose 0.5% as investors moved into sectors seen as relatively insulated from crude-price swings and monsoon-related risks.
Internet services firm Info Edge climbed 3.1% and Kalyan Jewellers advanced 5.4% after upbeat June-quarter business updates.
Why is the Indian stock market falling today?
According to stock market experts, this slide in the Indian stock market can be attributed to two primary factors: the escalation of the US-Iran war following US retaliatory strikes in Iran, and rising crude oil prices. Apart from this, weak Q1 results expectations, continuous FIIs’ selling, and profit-booking after a rise in the volatility index.
Stock market crash: Top 5 reasons
Here we list out the top five reasons that are dragging the key indices of Dalal Street today:
1] US-Iran war: The primary reason for the selling pressure in the Indian stock market can be attributed to the escalating tension in the US-Iran war. The fresh strikes by both sides have fueled uncertainty in the Middle East, sparking selling pressure across bourses, including Dalal Street.
2] Soaring crude oil prices: Higher oil prices hurt India, the world’s third-largest oil importer and consumer, by widening the import bill, stoking inflation and squeezing growth.
“With the renewed US-Iran tensions and the consequent spike in Brent crude to $76, the market is again back to uncertain territory,” said VK Vijayakumar, chief investment strategist at Geojit Investments.
“The market was slowly gaining strength on positive foreign inflows and improving macro fundamentals, but the latest flare-up in tensions has put a temporary question mark,” Vijayakumar said.
3] Buzz for weak Q1 results: Avinash Gorakshkar, a SEBI-registered fundamental equity analyst, believes the geopolitical tension in the Middle East has hit the global economy very badly, and it would take time for the global economy to come out of its repercussions. So, the upcoming corporate earnings for Q1FY27 are expected to remain weak, and hence, market participants are trying to discount that at higher levels.
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