Stock Market Crash: After three days of rise, there was a sharp decline in the market and the Sensex fell by 800 points…
highlights
- Stock Market Crash: After three days of rise, there was a sharp fall in the market.
- Sensex fell 800 points and Nifty fell below 25,600.
- Let us understand 4 big reasons why there was a selloff in the market today.
Stock Market Crash: Thursday is proving very difficult for investors in the stock market. After 3 consecutive sessions of rise, the market has taken a U-turn. After a mild opening in the morning, there was such selling pressure within a short time that the Sensex fell by 800 points and the Nifty also fell below 25,600. This sharp fall of the share market has caused a loss of about Rs 3 lakh crore to the investors. At the same time, BSE total market cap also decreased to around Rs 469 lakh crore. In such a situation, let us understand the 4 big reasons due to which there has been a sharp selloff in the stock market today.
1. Fed increased the tension of investors
The signals from the latest meeting of the US Federal Reserve have increased the turmoil in the global markets. There are differences of opinion among policy makers regarding interest rates. If US rates remain high or cuts are postponed, dollar assets become more attractive. This means that foreign investors can withdraw money from emerging markets. The same apprehension was seen in the Indian market and the possible withdrawal of foreign capital put pressure on the sentiment.
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2. Crude set the market on fire
The recent rise in crude oil prices also made the market nervous. There is a fear of supply disruption due to increasing tension in West Asia. Oil becoming expensive has a direct impact on India’s economy. Current account deficit may increase, inflationary pressure may return and the rupee may also be affected. The market has already started pricing these risks in.
3. Geo-political tension
Increasing military activities in the Middle East and the lack of concrete solutions on the Russia-Ukraine front have made global investors cautious. When uncertainty increases in the world, investors shy away from risky assets. This is why the Indian equity market has also not remained untouched by this global restlessness.
4. Profit booking at upper level
After three sessions of rise, the market had reached higher levels. In such a situation, even a little negative news triggers profit booking. Selling in weighted sectors like banking, metal, auto and FMCG deepened the decline. The initial gains did not last and the selling intensified.
At present, the market mood is cautious and eyes are fixed on global signals. The movement of oil, the stance of the Fed and geopolitical developments will decide the direction of the coming days. Volatility may increase, but in such times, companies with strong balance sheets and sustainable growth also create opportunities for long-term investors.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice in any way. ET NOW Swadesh recommends its readers and viewers to consult their financial advisors before taking any money-related decisions.
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