Synopsis : Indian equity markets witnessed a sharp sell-off with the Sensex plunging over 800 points and Nifty down 1%. Weak global cues, surging US bond yields, and sector-wide selling in FMCG, IT, and Auto stocks triggered the decline.
Market Meltdown – What’s Dragging Stocks Down?
The Indian stock market opened deep in the red on Thursday, with Sensex tumbling over 800 points to an intraday low of 80,727.11 and the Nifty shedding more than 250 points to hit 24,541.60. The sharp sell-off was led by global macro worries and a widespread sectoral decline back home.
Here are the three major reasons for today’s fall:
Weak Global Cues: US Fiscal Concerns Shake Confidence
Asian equities mirrored overnight Wall Street losses as US fiscal instability spooked investors. A weak 20-year US bond auction stoked fears about America’s economic outlook, especially after Moody’s credit downgrade warning.
Adding to investor anxiety, former President Donald Trump’s renewed push for tax cuts has triggered fresh concerns over the ballooning US deficit, sending global equity markets into risk-off mode.
Soaring US Bond Yields Spell Trouble for Emerging Markets
Rising US Treasury yields (notably the 5-year, 10-year, and 30-year) typically trigger capital outflows from emerging markets like India as investors opt for safer, high-yielding US assets.
“The real issue isn’t just rising yields—it’s the unsustainable US debt problem,” said Dr. VK Vijayakumar of Geojit Investments. “If this persists, capital may shift to economies with stronger growth prospects.”
Sectoral Carnage: FMCG, IT, Auto Drag Markets Down
Domestic pressure mounted as key sectors bled heavily:
FMCG stocks slumped, with Colgate Palmolive falling 5%, and other names like Hindustan Unilever, ITC, Nestle India, and Emami losing between 1.5%-2%.
Auto stocks also fell sharply – M&M, Tata Motors, Bajaj Auto, and Eicher Motors dropped more than 1%.
IT sector took a hit, led by a nearly 2% fall in Tech Mahindra, with Infosys, HCL Tech, and Persistent Systems following closely behind.
Disclaimer : This article is for informational purposes only and does not constitute financial advice. Please consult a qualified financial advisor before making any investment or trading decisions.
