The Indian stock markets plunge continued its decline for the sixth consecutive session on Thursday. The BSE Sensex, a benchmark index, opened the day at 63,774 and quickly reached an intraday low of 63,119 shortly after the opening bell. Over the past six days, this 30-stock index has seen a drop from 66,428 to 63,119, resulting in a loss of more than 3,300 points.
Israel Hamas War and Continuous FII Selling
Several factors have contributed to the recent stock market decline. The ongoing Israel-Hamas conflict has created uncertainty in the global markets, causing panic selling. Additionally, the stubbornly high US bond yields, with the 10-year bond yield near 5%, have led foreign portfolio investors (FPIs) to sell, particularly impacting sectors like banking and IT, which make up a significant portion of FPI investments. Despite these challenges, long-term investors may find opportunities to purchase quality stocks, especially in the banking sector, at attractive rates.
Markets Plunge: Rising Inflation
The escalating crude oil costs pose an additional worry for the Indian stock market because a sustained uptrend in crude oil prices due to Middle East tensions could lead to higher inflation in India. He mentioned that India heavily relies on importing approximately 85% of its crude oil demand, making the increasing crude oil prices a potential threat to Indian inflation and the economy.
Within the Sensex companies, JSW Steel, Tata Motors, Tata Steel, Tata Consultancy Services, NTPC, Wipro, HCL Technologies, State Bank of India, Larsen & Toubro, UltraTech Cement, IndusInd Bank, Kotak Mahindra Bank, Power Grid, and Reliance Industries Limited experienced significant declines. On the positive side, Mahindra & Mahindra and Bajaj Finance were the notable gainers.
