Indian stock market benchmark indices, Sensex and Nifty 50, experienced a significant sell-off on Monday. This was driven by global equity market declines, sparked by concerns over a potential US recession and rising geopolitical tensions in the Middle East.
Key Factors Influencing the Sell-Off:
- US Economic Concerns: Data indicating a weakening US job market has heightened fears of a recession. Investors are worried that the Federal Reserve may be lagging in providing necessary policy support.
- Profit Booking: Experts like Tanvi Kanchan from Anand Rathi Shares and Stock Brokers suggest that the current volatility is largely due to short-term profit booking rather than long-term panic. She advises a staggered approach to market entry during such volatile periods.
Impact on Markets:
Indian Stock Market:
- Sensex: Dropped by 2,450.32 points (3.03%) to 78,531.63.
- Nifty 50: Fell by 696.35 points (2.82%) to 24,021.35.
- Market Capitalization: Investors lost nearly ₹15 lakh crore in a single session as the market capitalization of BSE-listed companies fell from ₹457 lakh crore to ₹442 lakh crore.
Asian Markets:
- Japan: The Nikkei 225 index saw its largest points drop in history, plunging 12.40% (4,451.28 points) to 31,458.42. The Topix index also declined by 12.23% (310.45 points) to 2,227.15.
- South Korea: The Kospi index fell by 8.1%, triggering a 20-minute trading halt. The Kosdaq index dropped by 11.71%.
- Taiwan: The Taiwan Weighted Index declined by over 8%, with significant selling in technology and real estate stocks.
- Hong Kong: The Hang Seng index fell by 1.61%.
- China: The CSI 300 index declined by 0.48%.
Bond Market:
- India: Government bond yields fell, with the benchmark 10-year yield dropping to 6.8597%, the lowest since March 31, 2022.
- US: Treasury yields nosedived, with the 10-year yield hitting its lowest level since December.
Currency Market:
- Japanese Yen: Surged to 141.73 against the dollar, driven by safe-haven demand and recent Bank of Japan interest rate rises.
Cryptocurrency Market:
- Bitcoin: Plummeted by 15.5% to $51,323.58, continuing a 13.1% drop from the previous week.
- Ethereum: Declined by 22.3% to $2,262, with most major cryptocurrencies also deeply in the red.
Gold Market:
- Spot Gold: Increased by 0.14% to $2,446.83 per ounce, as investors sought safe-haven assets.
- US Gold Futures: Rose by 0.8% to $2,488.50.
- MCX Gold Rate: Increased by 0.19% to ₹69,925 per 10 grams.
- MCX Silver Price: Fell by 0.39% to ₹82,168 per kg.
