Sensex Hits 6-Month Low Amid Stock Market Crash
The BSE Sensex plunged to a six-month low on Monday, closing down 1,124.02 points, or 1.52%, at 72,771.72. This marks the lowest closing level since March 30, 2026. The Nifty index also fell, dropping 360.25 points, or 1.56%, to finish at 22,780.25. Investor sentiment has been heavily impacted by global economic turmoil and geopolitical uncertainty.
Market Crash in Numbers
The market decline on Monday resulted in a staggering erosion of Rs 7.52 lakh crore in investor wealth. Among the 30 Sensex constituents, 29 ended lower, with Larsen & Toubro experiencing the largest drop at 2.81%. Other notable declines included Power Grid at 2.62%, Adani Ports at 2.38%, and HDFC Bank at 2.30%. Infosys was the only stock to close higher.
The downturn extended beyond major indices, with the BSE SmallCap Select index falling 1.90% and the MidCap Select index declining 1.39%. Every sectoral index on the BSE recorded losses, with the PSU Bank index suffering the steepest decline at 3.25%. Over the past month, both the Sensex and Nifty have lost more than 5%, wiping out Rs 17.17 lakh crore in total investor wealth.
Reasons Behind the Decline
Rising crude oil prices, geopolitical tensions, and weak global market cues are contributing to the current market downturn. Analysts attribute the sell-off to a sharp increase in crude oil prices, driven by ongoing tensions related to the US-Iran situation. Persistent foreign fund selling and elevated US bond yields have further pressured the market.
Foreign Institutional Investors (FIIs) were net sellers, offloading shares worth Rs 3,693.93 crore on Friday. According to Vinod Nair, Head of Research at Geojit Investments Limited, bears are firmly in control, and the market has breached a key psychological support level. He noted that the US rejection of a ceasefire proposal has raised concerns about prolonged geopolitical tensions, which could lead to higher commodity prices.
Brent crude prices rose nearly 4% to $108.3 per barrel, while the US 10-year Treasury yield reached 5.2%. Ankur Punj, Managing Director of Equirus Wealth, stated that these factors are significant headwinds for the equity market. He emphasized that the current geopolitical climate and rising bond yields are likely to maintain a cautious sentiment among investors.
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