Mumbai: The Stock Market crashed on Thursday as Brent crude, the global oil benchmark, soared 6.25 per cent to USD 114.1 per barrel today. The domestic
market took a heavy beating after a three-day rally. The BSE Sensex tanked 2222.73 points to 74,481.41 at the time of writing this article. The 50-share NSE Nifty plunged 689.45 points to 23,088.35. The selloff led to wipe out of around Rs 10 lakh crore from the total market capitalisation of BSE listed companies.
Why did Stock Market crash?
The unabated selling by Foreign Institutional Investors (FIIs) have hit the domestic market hard. The FIIs sold equities worth Rs 2,714.35 crore on Wednesday.
The India VIX, referred to as the market’s fear gauge, jumped more than 16 percent to 21.72 level. A higher VIX is not good for markets as it indicates increased volatility.
“Indian equity markets opened sharply lower with a significant gap-down, as rising crude oil prices and escalating geopolitical tensions triggered a strong risk-off sentiment across global markets. Early trade reflected broad-based selling pressure after the previous three-session recovery, indicating that investors are turning cautious once again,” Ponmudi R, CEO of Enrich Money, said.
Gold and Silver prices plunge
Meanwhile, Gold and Silver prices also declined today. Gold prices on MCX declined over 2.80% to around 148600, tracking global weakness as spot gold slipped toward $4,750, hitting a nearly six-week low. The Federal Reserve maintained interest rates and signaled that cuts will remain on hold until inflation shows clear signs of easing, reducing gold’s appeal as a non-yielding asset. Despite escalating geopolitical tensions, including strikes linked to the South Pars Gas Field and attacks on Qatar’s LNG facilities, rising oil prices have increased inflation risks, limiting upside in gold prices.
Silver futures prices also recorded a sharp drop. The investor sentiment got hit because of the rising crude oil prices and the strict stance of the US Federal Reserve. On the Multi Commodity Exchange (MCX), silver for May delivery declined by Rs 14,891 to Rs 2,33,303 per kilogram. Notably, Silver May futures opened at Rs 2,45,000 per kilogram, weaker than the previous close of ₹2,48,194. Intraday, the white metal jumped to a high of Rs 2,45,674, however, heavy selling pressure, led to losses.
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