Sensex, Nifty today: The Indian stock market benchmarks dropped more than 1% on Tuesday, 15 September. The 30-share pack dropped 778 points, or 1.04%, to end at 74,003.82, while the NSE counterpart Nifty 50 fell to 23,118.60, falling 280 points, or 1.19%.
The mid and small-cap segments suffered deeper cuts. The BSE 150 Midcap index crashed 2.17%, while the BSE 250 Smallcap index plunged 2.40%.
Investors lost over ₹9 lakh crore in a single session as the overall market capitalisation of BSE-listed firms dropped to ₹472.4 lakh crore from ₹481.6 lakh crore in the previous session.
Why is the stock market down today?
Here are three key factors behind the fall in the Indian stock market today:
1. Oil remains at higher levels
Crude oil prices at $108 per barrel are a major worry for the Indian economy. Higher oil prices strain India’s fiscal position, as the country is the world’s third-largest oil importer.
oil rose on Tuesday amid concerns over potential supply disruptions, with a critical Saudi Arabian pipeline still offline. Brent crude climbed above $107 a barrel, approaching an intraday peak of just below $110 touched on Friday, its highest level since May.
Oil prices have been at elevated levels for most of the year now. Experts believe higher-for-longer oil prices will widen India’s current account deficit, distort its growth-inflation dynamics, increase the possibility of monetary tightening, and hit corporate profitability.
2. Rising US bond yields a major headwind
US 10-year bond yields have topped 5% for the first time since October 2023, driven by heightened inflation concerns, growing expectations of US Federal Reserve rate hikes, and mounting worries over government debt.
“Global equity markets will be under pressure from the US 10-year yield hitting the psychological 5% mark. The macro scenario will continue to be under pressure from the rising crude price. Brent crude at $107 and the damage caused to the Saudi East-West oil pipeline from the Houthi attack will continue to weigh on markets,” V K Vijayakumar, Chief Investment Strategist, Geojit Investments, noted.
“This is a scenario which the Fed cannot ignore in the FOMC meeting tomorrow. Even though President Trump doesn’t want a rate hike, his appointee Kevin Warsh is most likely to hike the rate by 25 bps because it would be difficult to justify a hold in rates in the present macro scenario,” Vijayakumar said.
3. The Fed in focus
To some extent, the prevailing weak sentiment can also be attributed to the US Fed’s monetary policy on Wednesday.
While the US central bank is widely expected to lift rates by 25 basis points, market sentiment could deteriorate further if it delivers a hawkish policy and projects a major hit to economic growth or a significant rise in inflation due to the US-Iran war.
Top contributors to the fall in the Sensex
ICICI Bank, Reliance, SBI, BEL, and Mahindra and Mahindra were the top five drags on the Sensex index.
On the Nifty, ICICI Bank, Reliance, SBI, L&T, and BEL were the top drags in that order.
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Disclaimer: This article is for educational purposes only and does not constitute investment advice. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
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