Sensex crashes 1,600 points as US-Iran war rattles markets
What's the story
The Indian stock market witnessed a major crash today, with the BSE Sensex plunging over 1,600 points or 2.07% to 75,943.14 within minutes of opening. The broader Nifty 50 index also fell sharply by 479.45 points or nearly 2% to trade at around 23,571.15 in early morning deals. The sharp decline comes amid rising global oil prices and escalating geopolitical tensions in West Asia after US-Iran talks collapsed and Washington threatened a blockade in the Strait of Hormuz.
Market reaction
Rising oil prices trigger inflation fears
The spike in crude oil prices, with Brent crossing $100 a barrel, has triggered broad-based selling across sectors. Higher oil prices are seen as a major risk for India, given its status as a major crude importer. The rise is likely to fuel inflation, widen the current account deficit and impact corporate margins negatively. At the time of writing, the Sensex is down 1.66% at 76,262.21, while the Nifty is down 1.65% at 23,654.50.
Sector impact
Financial, auto, capital goods stocks bleed
The market crash was led by major financial and cyclical stocks. Shares of HDFC Bank, ICICI Bank, and Axis Bank fell between 1.6% and 2.5%, pulling down the indices further. Other major laggards included Reliance Industries which fell over 2.6%, while State Bank of India (SBI) dropped more than 3%. Auto and capital goods stocks also witnessed heavy selling with Maruti Suzuki falling nearly 3% and Larsen & Toubro declining over 3%.
Stock performance
IT and consumption stocks also hit
IT majors like Infosys, TCS, and HCLTech mirrored global tech weakness with losses of up to 1.2%. Consumption and discretionary stocks were also hit as investors turned cautious on demand outlook amid rising inflation risks. Asian Paints fell nearly 4%, while Bajaj Finance was the biggest loser at over 4%.