Sensex ends 1,000 points as weak monsoon forecast, Iran uncertainty spook investors
The S&P BSE Sensex plunged 1,092.06 points, or 1.44%, to close at 74,775.74, while the NSE Nifty50 dropped 359.40 points, or 1.50%, to settle at 23,547.75.
Benchmark stock market indices witnessed heavy selling on Thursday, with the Sensex tumbling more than 1,000 points and the Nifty slipping below the 23,600 mark, as investors reacted to concerns over a weaker-than-normal monsoon forecast and lingering uncertainty around the US-Iran conflict.
The S&P BSE Sensex plunged 1,092.06 points, or 1.44%, to close at 74,775.74, while the NSE Nifty50 dropped 359.40 points, or 1.50%, to settle at 23,547.75.
Market sentiment weakened after the India Meteorological Department (IMD) projected monsoon rainfall at 90% of the Long Period Average (LPA), raising concerns about a possible impact on agricultural output and food prices. Investors also remained cautious as uncertainty persisted over the prospects of a lasting peace deal between the US and Iran, despite continued diplomatic efforts.
The sell-off was broad-based, with the Nifty Midcap 100 falling 1.33% and the Nifty Smallcap 100 declining 0.85%. India VIX, the market's fear gauge, surged 8.02%, indicating a sharp rise in investor nervousness.
Most sectoral indices ended in the red. Nifty Oil & Gas emerged as the biggest loser, falling 2.47%, followed by Nifty Metal, which declined 2.02%. Nifty Auto fell 1.96%, Nifty Healthcare Index dropped 1.86%, and Nifty Consumer Durables lost 1.62%. The Nifty IT index was the only major sector to buck the trend, rising 0.60% on continued buying in technology stocks.
Among Sensex stocks, Tech Mahindra was the top gainer, rising 1.86%. HCL Technologies gained 1.65%, while Larsen & Toubro climbed 1.07%. Asian Paints added 0.17%, and Infosys ended marginally higher.
On the losing side, Power Grid Corporation was the worst performer, falling 3.46%. Indigo dropped 3.27%, NTPC declined 2.86%, Mahindra & Mahindra lost 2.72%, and Tata Steel fell 2.72%. Bajaj Finance, Reliance Industries, Sun Pharmaceutical Industries, UltraTech Cement and Titan Company also witnessed heavy selling.
Despite the sharp fall in equities, the Indian rupee strengthened significantly. The rupee ended at 95.00 against the US dollar, gaining 0.7% during the day and recording its biggest single-day rise since April 2.
Vinod Nair, Head of Research, Geojit Investments Limited, said, "The market witnessed broad-based selling pressure following the IMDs monsoon forecasts to 90% of the long period average (LPA), raising concerns among investors. The prospect of deficient rainfall, coupled with the increasing likelihood of an El Nio weather pattern, has heightened fears of elevated food inflation in the coming months."
He added, "However, the downside risk appears partially mitigated by the recent moderation in crude oil prices and bond yields. Additionally, global sentiment remains supported by expectations of a potential diplomatic breakthrough between the US and Iran, which has contributed to a rally in international markets."
Nair said investors will now focus on domestic triggers. "In the near term, investor attention is expected to shift toward key domestic triggers, particularly the upcoming RBI monetary policy decision and GDP data release, which will provide further insights into the inflation trajectory and overall economic momentum."
Brent crude fell 1.52% to $92.29 per barrel, while WTI crude declined 1.47% to $87.59 per barrel, offering some relief on the inflation front even as broader market sentiment remained weak.
Benchmark stock market indices witnessed heavy selling on Thursday, with the Sensex tumbling more than 1,000 points and the Nifty slipping below the 23,600 mark, as investors reacted to concerns over a weaker-than-normal monsoon forecast and lingering uncertainty around the US-Iran conflict.
The S&P BSE Sensex plunged 1,092.06 points, or 1.44%, to close at 74,775.74, while the NSE Nifty50 dropped 359.40 points, or 1.50%, to settle at 23,547.75.
Market sentiment weakened after the India Meteorological Department (IMD) projected monsoon rainfall at 90% of the Long Period Average (LPA), raising concerns about a possible impact on agricultural output and food prices. Investors also remained cautious as uncertainty persisted over the prospects of a lasting peace deal between the US and Iran, despite continued diplomatic efforts.
The sell-off was broad-based, with the Nifty Midcap 100 falling 1.33% and the Nifty Smallcap 100 declining 0.85%. India VIX, the market's fear gauge, surged 8.02%, indicating a sharp rise in investor nervousness.
Most sectoral indices ended in the red. Nifty Oil & Gas emerged as the biggest loser, falling 2.47%, followed by Nifty Metal, which declined 2.02%. Nifty Auto fell 1.96%, Nifty Healthcare Index dropped 1.86%, and Nifty Consumer Durables lost 1.62%. The Nifty IT index was the only major sector to buck the trend, rising 0.60% on continued buying in technology stocks.
Among Sensex stocks, Tech Mahindra was the top gainer, rising 1.86%. HCL Technologies gained 1.65%, while Larsen & Toubro climbed 1.07%. Asian Paints added 0.17%, and Infosys ended marginally higher.
On the losing side, Power Grid Corporation was the worst performer, falling 3.46%. Indigo dropped 3.27%, NTPC declined 2.86%, Mahindra & Mahindra lost 2.72%, and Tata Steel fell 2.72%. Bajaj Finance, Reliance Industries, Sun Pharmaceutical Industries, UltraTech Cement and Titan Company also witnessed heavy selling.
Despite the sharp fall in equities, the Indian rupee strengthened significantly. The rupee ended at 95.00 against the US dollar, gaining 0.7% during the day and recording its biggest single-day rise since April 2.
Vinod Nair, Head of Research, Geojit Investments Limited, said, "The market witnessed broad-based selling pressure following the IMDs monsoon forecasts to 90% of the long period average (LPA), raising concerns among investors. The prospect of deficient rainfall, coupled with the increasing likelihood of an El Nio weather pattern, has heightened fears of elevated food inflation in the coming months."
He added, "However, the downside risk appears partially mitigated by the recent moderation in crude oil prices and bond yields. Additionally, global sentiment remains supported by expectations of a potential diplomatic breakthrough between the US and Iran, which has contributed to a rally in international markets."
Nair said investors will now focus on domestic triggers. "In the near term, investor attention is expected to shift toward key domestic triggers, particularly the upcoming RBI monetary policy decision and GDP data release, which will provide further insights into the inflation trajectory and overall economic momentum."
Brent crude fell 1.52% to $92.29 per barrel, while WTI crude declined 1.47% to $87.59 per barrel, offering some relief on the inflation front even as broader market sentiment remained weak.
