Indian stock markets experienced a dramatic downturn on Monday, with the Sensex plummeting by 2,222.55 points to close at 78,759. The Nifty also took a significant hit, falling by 662 points to settle at 24,055. This steep decline represents a loss of over Rs 15 lakh crore in investor wealth in a single day.
The market’s sharp fall is attributed to growing concerns about a potential recession in the United States. These fears have triggered a global sell-off, impacting stock markets worldwide. As a result, Indian equities have also faced selling pressure.
Since reaching record highs on August 1, the Sensex has shed a substantial 3,370 points, representing a decline of 4.10%. Similarly, the Nifty has lost 1,023 points, or 4.07%, from its peak.
The banking, IT, auto, and metal sectors bore the brunt of the selling, with several stocks experiencing declines of up to 7.32%. In contrast, only a handful of stocks managed to buck the trend, with limited gains.
Market breadth was overwhelmingly negative, with a significant majority of stocks ending in the red. The selling pressure was so intense that 293 stocks hit their lower circuit limits, indicating extreme bearish sentiment.
Foreign institutional investors (FIIs) contributed to the downward trend by offloading shares worth Rs 3,310 crore on Friday. While domestic investors bought shares worth Rs 2,965.94 crore, it was not enough to offset the selling pressure from foreign investors.
The market outlook remains uncertain. Analysts caution that the market is likely to remain volatile in the short term, with potential for further downside. The situation will continue to be influenced by global economic developments, particularly the US economy’s trajectory. Investors are advised to exercise caution and monitor market trends closely.
The overall market capitalization of BSE-listed companies has contracted to Rs 441.82 lakh crore, reflecting the substantial loss incurred by investors.
