Sensex plunges nearly 1,750 points - Know factors behind stock market crash

Stock market investors woke up on Monday morning to plunging indices. Massive amount of investor wealth was lost as BSE Sensex crashed nearly 1,750 points while NSE Nifty dived by more than 530 points. Indian stocks lost as much as 3% of their value as 30-share Sensex settled at 56,405.84 with a drop of 1,747.08 points. The broader NSE gauge Nifty dived to 16,842.80 with a 531.95-point fall.

The stock market crash was triggered by multiple factors, both global issues and domestic. The mounting tensions between Russia and Ukraine and fears of escalation was one of the factors behind the markets faring poorly. Domestically, the underwhelming data on industrial production further fuelled the fall.

Furthermore, factors like increasing crude oil prises and selling pressure from Foreign Institutional Investors did not help the stock market crash. Stocks dipped globally on Monday with a surge in commodity prices, including crude oil, due to the ripple effect of the growing geopolitical tensions.

The worst hit sectors in today’s crash were realty, metals, banks and auto indices. Deepak Jasani, Head of Retail Research, HDFC Securities was quoted by news agency PTI as saying, “Nifty remains under pressure due to rising crude oil prices, the Russia Ukraine conflict and subdued Corporate results.”

Apart from TCS, all other shares on the Sensex witnesses huge to medium losses. Big companies HDFC, SBI and Tata Steel dived by more than 4%. The plunging stock market wasn’t restricted to India but other Asian stock exchanges saw similar losses. Concerns of a Russian invasion of Ukraine resulted in oil prices skyrocketing.

 

 

(With inputs from PTI)