Asian markets like Japan, South Korea and Hong Kong were trading in the green on Monday, but the Indian stock market (Sensex-Nifty) suddenly fell sharply after opening. On Monday, January 12, a huge fall was seen in the Indian stock market. Sensex slipped 525 points in just two minutes after opening, while Nifty suddenly fell 150 points. After all, what is the reason for the sudden huge decline in the Indian market?
Main reasons for market decline
As soon as the Indian stock market (Sensex-Nifty) opened on Monday, it faced a sudden decline. While Asian markets like Japan, South Korea and Hong Kong were trading on a bullish note, India’s market went down within minutes of opening. According to experts, there are several major reasons behind this:
1. Threat of US tariffs on Russian oil
America has warned of imposing tariffs of up to 500% on the purchase of oil from Russia. This created fear among investors and increased pressure in the market.
2. Selling by foreign investors
Foreign investors are continuously selling their shares, due to which the liquidity pressure in the market increased and both Sensex-Nifty witnessed a decline instead of a rise.
3. Iran crisis and surge in oil prices
Oil prices have increased in the international market due to the Iran crisis. Expensive oil increases companies’ costs and weakens investor confidence.
4. Impact of last week’s fall
Last week, the Sensex had registered a decline of 2,185.77 points or 2.54%. Due to this pressure, investor sentiment is still negative.
Sensex and Nifty fall instead of a bullish start
The 30-share Bombay Stock Exchange Sensex opened at 83,435.31 compared to its previous close of 83,576.24 and fell by more than 525 points to 83,043 in just a few minutes. Similarly, NSE’s 50-share Nifty also slipped from 25,683.30 to 25,529.
Massive decline in shares of companies
With the opening, BSE largecap stocks like BEL, Adani Ports and PowerGrid started performing weakly. In midcap, BHEL, IPCALAB and PowerIndia saw a decline of 3-4%. Among smallcap stocks, KERNEX and Tejas Network lost up to 12% and 8% respectively.
Last week’s pressure continues
Last week, the Sensex had recorded a total decline of 2,185.77 points or 2.54%. Seven of the country’s top 10 companies in terms of market cap suffered a total loss of Rs 3.63 lakh crore. During this period, the most affected companies included Reliance and HDFC Bank.
The paradox of global signals and domestic pressure
While Japan’s Nikkei was trading 1.61% higher at 51,939 and Hong Kong’s Hang Seng was trading higher at 26,456, the Indian market could not take advantage of this positive environment. South Korea’s Kospi was also trading sharply at 4,622.
Due to all these reasons, the Indian stock market has fallen victim to global positive signals.
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