Sensex plummets over 600 points, Nifty slips below 22,600 mark
What's the story
The Indian stock market witnessed another downturn on Tuesday, with the Sensex plunging over 600 points and the Nifty slipping below the 22,600 mark. The decline was mainly attributed to rising crude oil prices, continued foreign investor selling pressure, and weakness in financial stocks. At around 10:00am, the Sensex was down by 622.71 points or 0.86% at 72,149.01 while Nifty50 had fallen by 184.85 points or 0.81% to trade at 22,595.40.
Market performance
Nifty Midcap 100 and Smallcap 100 decline by nearly 1%
The market witnessed a broad-based sell-off with Nifty 100, 200, and 500 indices falling by 0.84%, 0.85%, and 0.87%, respectively.
The midcap index Nifty Midcap 100 fell by 0.89% while smallcap index Nifty Smallcap 100 declined by 0.94%.
The India VIX also jumped by 6.14% to trade at over ₹14.48.
Oil prices
Rising crude oil prices add to inflation concerns
Crude oil prices continued to rise amid supply concerns stemming from the US-Iran conflict.
Brent crude was trading at $107.12 per barrel, up by 1.75%, while WTI crude rose by 1.64% to trade at $94.12 per barrel.
As one of the world's largest crude importers, India could see its import bill rise and inflationary pressures mount due to prolonged high oil prices, which could also squeeze corporate margins and pressure economic growth if these elevated levels persist.
Market pressure
Financial stocks weigh on benchmarks
Financial stocks have been a major drag on the benchmarks. At around 10:00am, Bajaj Finance was the worst-performing Sensex stock, down by 2.14%.
Other major players like HDFC Bank, Kotak Mahindra Bank and Infosys also witnessed declines of over 1% each.
The weakness in financial stocks comes after a sharp sell-off in insurance-linked financial companies last week due to proposed changes to insurance commission structures by IRDAI.
Investor trends
Foreign investors continue to sell Indian equities
Foreign investor outflows are further adding to the pressure on Indian equities. FIIs sold ₹5,353.22 crore in the cash market on Monday, data showed.
This was despite domestic institutional investors buying ₹5,189.02 crore, showing continued support from domestic flows.
Most listed Tata companies also witnessed declines with Tata Motors falling by 3% and Tata Investment dropping by 2.5% in Tuesday's market update.