Sensex crashes nearly 900 points: What's behind today's decline?
What's the story
India's benchmark indices, Sensex and Nifty, witnessed a downward trend on Wednesday. The decline was mainly due to mixed signals from the US-Israel war on Iran, leaving investors uncertain about its impact on inflation and growth. At the time of writing, Sensex was trading at 77,348.4, down by 857.58 points while Nifty was down by over 240 points or 1% at about 24,021. Auto, financials, IT and FMCG stocks lead the decline, with sectoral declines in the range of 0.4%-0.6%.
Market dynamics
FIIs continued their net selling spree
On March 10, foreign institutional investors (FIIs) continued their net selling spree worth ₹4,673 crore. In contrast, domestic institutional investors (DIIs) made a net purchase of over ₹6,333 crore. "The FII vs DII game is back to the last one-year pattern of sustained selling by FIIs being more than matched by sustained buying by DIIs," said VK Vijayakumar from Geojit Investments Limited.
Market performance
Financial services firms among worst performers
The previous session saw a broad-based rally with Nifty 50 closing around 24,261 and Sensex settling near 78,206. However, on March 11, auto, financials IT FMCG stocks led the decline with sectoral indices trading lower by 0.4%-0.6%. Financial services firms like Kotak Mahindra Bank SBI Life Insurance Co Bajaj Finserv were among the worst performers in Nifty 50 index losing nearly one percent each.
Global impact
Mixed signals from the US-Israel war on Iran
The ongoing Middle East crisis has kept investors on edge. The US and Israel have launched what some are calling the war's heaviest strikes on Iran. However, US President Donald Trump said on Monday that the conflict could be "over soon." These mixed signals continue to influence market sentiment and investor decisions in India.