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Sensex drops 1,000 points, Nifty slips below 23,600 amid stock market turmoil

Stock market today: The S&P BSE Sensex ended 984.23 points lower at 77,690.95 at the closing bell, while the NSE Nifty50 fell 324.40 points to settle at 23,559.05.

by · India Today

In Short

  • FII outflows, inflation spike dampen investor sentiment, worsen market mood
  • Nifty Bank, Financials struggle as market volatility rises sharply
  • Analysts warn of prolonged market turmoil as investors remain cautious

Benchmark stock market indices fell sharply during Wednesday's trading session as investor sentiments were impacted by sustained foreign outflows, rising retail inflation, and reduced optimism over the prospect of a rate cut.

The S&P BSE Sensex ended 984.23 points lower at 77,690.95 at the closing bell, while the NSE Nifty50 fell 324.40 points to settle at 23,559.05.

The other broader market indices plummeted during the session due to a sharply rise in market volatility.

All Nifty Sectoral indices were also battered during the session, with high-weightage Nifty Bank and Nifty Financial Services falling sharply. However, Nifty Realty fell over 3% and was the top loser among sectoral indices.

The top five gainers on Nifty50 were Britannia, Grasim, Tata Motors, Asian Paints and NTPC. However, the gains were marginal, not even exceeding 0.5%.

On the other hand, the top losers were Hero MotoCorp, M&M, Hindalco, Tata Steel and Eicher Motors.

Vinod Nair, Head of Research, Geojit Financial Services, said, “Relentless selling by FIIs amid weak corporate earnings and a sharp surge in domestic inflation to a 14-month high have further impacted investor sentiment, dashing hopes for a near-term rate cut by the RBI.”

“Mid and small-cap stocks were the worst hit, while the Financials and Auto sectors also showed significant weakness,” he noted.

“This trend is mirrored across all emerging markets, as markets are jittery about future US policy actions, including trade-related implications for the world economy, which is reflected in the strengthening US dollar and rising yields,” he added.

Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, agreed with Nair. He said, “With inflation once again rising sharply and breaching above the RBI's comfort level, receding hopes of any major rate cuts in the near future by the central bank put the markets into a tizzy.”

“Also, relentless FII selling in local equities, along with rising US bond yields and dismal corporate earnings show has prompted overseas investors to park their funds in relatively cheaper markets like China,” he added.