Sensex plunges over 750 points, Nifty50 falls below 23,150
What's the story
India's benchmark indices, the Sensex and Nifty, opened sharply lower on Monday. The fall was led by rising oil prices, escalating tensions in West Asia, and fears of a US Federal Reserve rate hike. The BSE Sensex was trading at 73,489.99, down 753.35 points or 1.01%. Meanwhile, the Nifty50 fell by over 200 points to trade below the crucial level of 23,150 in early trade today.
Market response
Broader selloff across Asia
The Indian stock markets' decline mirrors a broader selloff across Asia, triggered by the spike in oil prices after Iran's missile strikes on Israel. The Brent crude futures surged some 3.5% to around $96.5 per barrel, raising inflation concerns and fears of disruption to global energy supplies. The broader MSCI Asia ex-Japan index fell nearly 2.7%, with South Korea's KOSPI and Japan's Nikkei witnessing heavy losses amid a selloff in tech and AI stocks that had previously fueled market gains.
Rate hike implications
Foreign investors cut risk exposure amid US rate hike fears
Higher US interest rates typically make emerging-market assets like Indian equities less appealing, leading foreign investors to cut their risk exposure. The selling pressure was broad-based with 44 of the 50 Nifty constituents trading in the red and only six stocks advancing. Tata Steel was the biggest loser among Sensex stocks, falling over 2%. Other major laggards included Mahindra & Mahindra, TCS, Eternal, IndiGo, Asian Paints, Bajaj Finance, Infosys, HCLTech, Larsen & Toubro, and Reliance Industries.