The Indian stock market experienced a significant downturn on Monday, with both Sensex and Nifty diving nearly 1%. This decline was driven by several factors, including soaring global bond yields and the rupee falling to a fresh all-time low. As of 10:58 AM, Sensex was down by 600 points at 74,686, while Nifty 50 fell below the 23,500 mark. The day’s trading saw Sensex drop nearly 1,000 points initially, with Nifty slipping below 23,350 before recovering some losses. The sharp decline led to a staggering loss of approximately Rs 7 lakh crore in total market capitalization for companies listed on the Bombay Stock Exchange, now standing at Rs 454 lakh crore.
India VIX, which gauges market volatility, spiked over 5% to around 19.78, signaling increasing uncertainty. The sell-off was widespread, impacting the Nifty Midcap 100 and Nifty Smallcap 100 indices, each declining by over 1%. Notable stocks that suffered heavy losses included Power Grid Corporation of India, Tata Steel, and Bajaj Finance, among others, which saw decreases of up to 5%. Conversely, despite the broader market weakness, some IT stocks like Infosys and TCS posted gains of around 1%.
VK Vijayakumar, Chief Investment Strategist at Geojit Investments, had earlier indicated that market conditions might weaken due to global cues. He highlighted that elevated crude oil prices could result in additional price hikes for petrol and diesel, adversely impacting inflation. Additionally, the surge in the US 10-year bond yield to 4.62% posed challenges for emerging markets, leading to a potential cycle of rupee depreciation and foreign portfolio investor (FPI) selling. However, he noted that export-oriented sectors such as pharmaceuticals would show resilience, and that fundamentally strong private sector banks could become attractive for long-term investors looking to accumulate on dips.
Several factors were outlined as influencing the stock market today:
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Global Tensions with Iran: Former US President Donald Trump issued a fresh warning regarding Iran, stating that “the clock is ticking.” His remarks came amidst increased tensions in the Middle East, raising anxieties among investors.
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Record High Bond Yields: Bond yields surged to historic highs worldwide amid inflationary pressures and fiscal concerns stemming from ongoing conflicts. The US 10-year bond yield climbed to 4.632%, marking its highest level since February 2025, while the yields in Japan mirrored similar trends.
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Rupee Weakness: The rupee hit a record low of 96.18 against the US dollar, exacerbated by high oil prices and the ongoing geopolitical crisis. The currency’s steep decline has contributed to a risk-averse sentiment among market participants.
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Rising Oil Prices: Oil prices exceeded $110 per barrel, following renewed fears of conflict escalation in the Middle East. This rise is likely to further strain inflationary pressures domestically.
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Global Market Trends: A downturn in global markets was noted, with declines in Asia’s major indices and significant losses on Wall Street, signaling a troubling trend that reflects investor trepidation.
In the midst of this, foreign institutional investors turned net buyers, acquiring Indian shares worth Rs 1,329 crore in a recent session, although this figure remained modest compared to prior sell-offs.
From a technical standpoint, analysts indicated that Nifty formed a bear candle with shadows, implying a consolidative phase. Moving forward, a failure to breach the resistance levels between 23,800 and 23,900 could prolong the bearish bias, potentially leading to further tests of support levels at 23,300 and 23,000.
Experts continue to advise caution amidst these turbulent market conditions, with focus shifting towards sectors that may offer resilience and opportunities for long-term investments.
