Stock market crash today: On account of the Israel-Iran war escalating tension in the Middle-East region, rising US dollar rates and the US Treasury yield, FIIs’ selling, etc., the Indian stock market extended its selling pattern for the second straight session on Monday.
The Nifty 50 index opened lower at 22,339 level and went on to touch an intraday low of 22,264 mark, losing over 1 percent within a few minutes of the opening bell. The BSE Sensex lost over 800 points and hit an intraday low of 73,727 mark during the early morning session.
Stock market crash today
In the last two sessions, the Nifty 50 index has crashed over 400 points, the BSE Sensex has lost over 1300 points whereas the Bank Nifty index has nosedived over 1,000 points.
In the broad market, the small-cap index has crashed over 2 percent whereas the mid-cap index has lost to the tune of 1.50 percent since Friday last week.
According to Avinash Gorakshkar, Head of Research at Profitmart Securities, there are multiple factors contributing to the current decline of the Indian stock market.
The intensifying conflict between Israel and Iran has significantly impacted market performance, alongside the rising US dollar and Treasury yields, selling by foreign institutional investors, depreciation of the Indian National Rupee (INR), and increasing crude oil prices.
The interaction of these forces has created considerable selling pressure unfavorably impacting trading results.
Top analysts outlined the primary factors behind the Indian stock market decline, which include geopolitical concerns due to escalating Middle East tensions such as the Iran-Israel war, leading to doubts and selling issues among investors. Avinash Gorakshkar affirmed this assessment.
2] Weal global market: “After escalation in the Middle East, selling has taken place across the global bourses. The US stock market ended lower on Friday. In the early morning session on Monday, major Asian markets like Nikkei, Hang Seng, Kospi, etc., are trading under pressure,” said Sandeep Pandey, Founder of Basav Capital.
3] Rise in US dollar rates: “US dollar is continuously rising and the US dollar index has come close to 106 levels and the US dollar rate has touched 34-year high against the Japanese Yen. This has spurt the US Treasury yields that has spurt selling in global equity market, which includes the Indian stock market,” said Avinash Gorakshkar of Profitmart Securities.
4] Soaring crude oil prices: “Crude oil prices have surged to the six-month high in domestic and international markets. The fuel prices have risen to the tune of 6 percent in March 2024 whereas, in April 2024, it has surged more than 3 percent till date,” said Anuj Gupta, Head of Commodities & Currency at HDFC Securities.
“Soaring crude oil prices are not a good sign for the global economy as it is expected to put pressure on the local currency and inflation,” said Sandeep Pandey of Basav Capital.
5] FIIs’ selling: “Due to the geopolitical uncertainty and rising US dollar rates, FIIs are fishing out money from the Indian stock market. On Friday, they sold out Indian stocks worth ₹8,027 crore in the cash segment whereas they sold out around ₹2,000 worth of shares in the F&O segment,” said Avinash Gorakshkar.
