Mumbai, September 24 (TNA) Indian equity markets suffered their sharpest decline in several weeks on Thursday, with the Sensex plunging more than 1,200 points and the Nifty 50 dropping below the 23,100 mark. The sell-off wiped out an estimated ₹6 lakh crore in market capitalisation.
The Sensex fell 1,149.81 points, or 1.54 per cent, to close at 73,678.44, while the Nifty 50 declined 384.05 points, or 1.64 per cent, to settle at 23,062.85. Financial stocks led the decline, while selling was also seen across mid-cap and small-cap shares.
The fall was driven by a combination of weak global cues, a sharp rise in US bond yields and elevated crude oil prices. The US 10-year Treasury yield climbed to around 5.11 per cent, its highest level in nearly two decades, making riskier emerging-market assets less attractive.
Key triggers
Crude oil prices also remained above $100 a barrel amid renewed geopolitical tensions involving Iran and the United States. Higher oil prices are a concern for India because the country imports a large share of its crude requirements, raising fears of increased inflation and pressure on the current account.
Domestic financial stocks came under additional pressure after the Insurance Regulatory and Development Authority of India proposed curbs on commissions and distribution payouts. Investors feared that the changes could affect the earnings of insurance distributors, banks and non-bank lenders.
Shares of PB Fintech, the parent company of Policybazaar, and Max Financial fell sharply, while major banking and financial stocks including HDFC Bank, ICICI Bank, Bajaj Finance, Axis Bank and Bajaj Finserv were among the key laggards.
Broad-based weakness
The sell-off was not limited to the headline indices. Fourteen of the 16 major sectoral indices ended lower, while the Nifty Midcap 50 and Nifty Midcap 100 also declined. The India VIX, a measure of expected market volatility, rose around 9.9 per cent to 11.37.
Market breadth remained weak, with declining shares substantially outnumbering gainers. Technology stocks, banks, financial services and consumer-linked counters faced selling pressure, while select pharmaceutical and media stocks offered limited resistance.
Investors will now track crude oil prices, global bond yields, foreign portfolio flows and developments in the Iran-US standoff. Analysts expect volatility to remain elevated, particularly if oil prices stay above $100 a barrel or US yields rise further.