The Bombay Stock Exchange (BSE).
Credit: PTI File Photo
Bengaluru: Indian equities logged their worst session in two months with NSE Nifty 50 and BSE Sensex both slipping more than 2 per cent amid concerns of escalation of hostilities in West Asia, and foreign fund outflows to Chinese stock markets.
The Nifty 50 index closed 2.12 per cent lower at 25,250.1 points, while the Sensex shed 2.1 per cent to 82,497.1 points. The benchmarks posted their worst session since early August.
West Asia tensions curbed risk sentiment after Iran fired ballistic missiles at Israel earlier this week, stoking worries that crude supplies from the world’s biggest producing region may be disrupted.
“The domestic market took a sharp downturn following Iran’s launch of ballistic missiles at Israel, sparking fears of retaliation and escalation in war. This could potentially drive up oil prices and lead to inflationary pressures,” said Vinod Nair, Head of Research, Geojit Financial Services.
“Additionally, new Sebi regulations for the F&O segment have raised concerns about reduced trading volumes in the broader market. Lastly, with attractive valuations in China, FIIs have redirected their funds, adding pressure on Indian stocks,” Nair said.
Foreign Institutional Investor (FII) outflows from India to China may intensify in the near term due to China’s recent announcement of stimulus measures to boost its economy.
A jump in oil prices on the day triggered declines in domestic paint makers, tyre makers and oil refiners, which count crude or crude-linked products as their raw material.
The international benchmark for oil prices, Brent crude, topped $75 per barrel.
The combined market capitalisation of the 30 Sensex stocks tanked Rs 9.78 lakh crore on Thursday. Larsen & Toubro, Axis Bank, Tata Motors, Reliance Industries, Maruti, Asian Paints, Bajaj Finance, Bajaj Finserv, Kotak Mahindra Bank, Adani Ports, Titan and HDFC Bank were the biggest laggards.
“The bears have been relentless, wiping out over 1,000 points in the last four sessions,” said Rajesh Bhosale, Equity Technical Analyst, Angel One. Bhosale added that geopolitical concerns and regulatory developments have dented market sentiments.
Among individual stocks, consumer goods firm Dabur lost 6.3 per cent after it forecast its first quarterly revenue decline since 2020, while shares of Reliance Industries slumped nearly 4 per cent, wiping out Rs 77,606.98 crore from its market valuation.
In Asian markets, Hong Kong settled lower while Tokyo ended in the positive territory. European markets were trading mostly lower.