The Indian stock market extended its losses on Wednesday, with the Sensex and Nifty plunging over 2% each to log the worst single-day fall since March-end as surging crude oil prices, weak global cues and renewed geopolitical tensions battered investor sentiment. The selloff gathered pace in the second half of trade after US President Donald Trump said an interim agreement with Iran to end the war was "over", stoking fears of a fresh escalation in the Middle East.
Sensex crashed 1,677 points to close at 76,503.60, while Nifty 50 plunged around 517 points to end the session at 23,882.05. The sharp decline erased more than Rs 8 lakh crore in investor wealth, dragging the combined market capitalisation of all BSE-listed companies down to less than Rs 472 lakh crore.
Here's how analysts read the market pulse
Sentiment on the domestic bourses turned decisively negative this session, wiping out the recent gains as renewed flare-ups in West Asia sent crude oil prices climbing, said Vinod Nair, Head of Research at Geojit Investments. He added that inflationary worries resurfaced as well, pushing bond yields higher both at home and in the US. Volatility remained elevated, with a sharp spike in India VIX as every sector traded in the red, reflecting a macro-driven flight from risk compounded by pre-earnings anxiety over muted Q1 forecasts, according to the analyst.
“While the upcoming earnings results may not, by themselves, prove to be a major market-moving catalyst, investors will closely monitor management commentaries and forward guidance to assess whether earnings weakness persists into Q2, delaying FY27 domestic earnings recovery and market performance,” Nair said.
Going ahead, the analyst believes that the market's direction will largely be determined by the outcome of the Fed's July policy meeting, the impact of the expiration of the current US reciprocal tariff truce, and the evolution of geopolitical tensions in the Middle East, whether through escalation or resolution.
Also read: 5 factors why stock market crashed on Wednesday
US stocks
Wall Street opened lower as rebuilding tensions in the Middle East weighed on sentiment, further bolstered by a new warning from the International Monetary Fund that the conflict will cut into global growth this year.
Investors will also be closely watching Fed meeting minutes due out later Wednesday, the first under new Chairman Kevin Warsh, for hints on how he may steer the central bank's policy and messaging.
European markets
In stock markets abroad, losses for European markets worsened after Trump made his comments, and Germany’s DAX lost 2%. The stock selloff hit globally, with European shares dropping 1%.
Tech view
Nifty’s sharp crash came as investors shifted to a risk-off mode following Donald Trump's remarks that the ceasefire was over, Rupak De, Senior Technical Analyst at LKP Securities, noted. He added that the index declined after upward consolidation, dampening recent optimism. However, it found support around the 50% Fibonacci retracement level of the previous rally from 23,070 to 24,348, which is placed near 23,800.
“Going forward, it will be crucial to watch whether the Nifty manages to hold the 23,800 support level. A decisive break below 23,800 could extend the ongoing corrective phase, while sustained trading above this level may pave the way for a meaningful recovery in the near term,” De said.
Most active stocks in terms of turnover
HDFC Bank (Rs 3,185 crore), Reliance Industries (Rs 2,564 crore), Kalyan Jewellers (Rs 1,999 crore), Eternal (Rs 1,699 crore), BSE (Rs 1,503 crore), ICICI Bank (Rs 1,477 crore) and SBI (Rs 1,451 crore) were among the most active stocks on NSE in value terms. Higher activity in a counter in value terms can help identify the counters with the highest trading turnovers in the day.
Most active stocks in volume terms
Vodafone Idea (Traded shares: 41.59 crore), Physicswallah (Traded shares: 8.67 crore), Yes Bank (Traded shares: 8.38 crore), Ola Electric Mobility (Traded shares: 7.26 crore), JP Power (Traded shares: 6.94 crore), Suzlon Energy (Traded shares: 6.51 crore) and Eternal (Traded shares: 5.86 crore) were among the most actively traded stocks in volume terms on NSE.
Stocks showing buying interest
Kalyan Jewellers, Ather Energy, MCX, Chennai Petro, NALCO, Premier Energies and Ami Organics were among the stocks that witnessed strong buying interest from market participants.
52-week high
Among the ones which hit their 52-week highs on NSE included Ather Energy, J&K Bank, FSN E-Comm (Nykaa), J B Chemicals, Adani Transmission, Schneider and Torrent Pharma.
Stocks seeing selling pressure
Stocks which witnessed significant selling pressure were Aegis Logistics, Aegis Vopak Terminal, L&T Fin Holding, Phillips Carbon, Jubilant Food, Mphasis and Jio Financial Services.
52-week low
Among the ones that hit their 52-week lows on NSE included Birlasoft, Brainbees Solutions, IRFC and Supreme Industries.
Sentiment meter favours bears
Out of the 3,411 stocks that traded on the NSE on July 8, Wednesday, 699 stocks witnessed advances, 2,633 saw declines while 79 stocks remained unchanged.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
