Indian equity markets witnessed a sharp sell-off on Monday, the first trading day of the week, wiping out nearly ₹15 lakh crore in investor wealth within minutes of opening trade. The Nifty 50 dropped nearly 700 points in early trading, while the Sensex also declined sharply amid heavy selling pressure.
Market experts said the decline was primarily driven by a sharp rise in crude oil prices, weakness in global markets, and a stronger US dollar. Escalating geopolitical tensions in West Asia have pushed oil prices higher, weighing on investor sentiment in India.
Crude oil surge triggers market pressure
In international markets, crude oil prices surged nearly 30 percent, rising above $115 per barrel. The spike comes amid concerns over supply disruptions due to rising military tensions in the West Asia region.
India is among the largest importers of crude oil, and any significant rise in oil prices directly impacts the country’s economy as well as the stock market.
Shares of oil marketing companies and aviation firms were among the biggest losers. HPCL, BPCL, and Indian Oil declined by nearly 6 percent, while shares of IndiGo fell more than 5 percent in early trade.
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Global markets also under pressure
The impact of rising oil prices was not limited to India. US and Asian equity markets also witnessed heavy selling.
Futures linked to the Dow Jones Industrial Average dropped by nearly 1,100 points. In Asia, markets also came under pressure, with South Korea’s Kospi index falling more than 8 percent, triggering a temporary halt in trading.
Such global sell-offs tend to spill over into Indian markets, adding to the downside pressure.
Strong dollar weighs on emerging markets
Another factor contributing to the decline was the strengthening US dollar. The Dollar Index climbed close to the 100 level, putting pressure on emerging market currencies.
The Indian rupee weakened to around 92.20 per dollar, hovering near record low levels.
A stronger dollar typically impacts metal stocks and companies dependent on imports, as costs rise and foreign investment flows slow.
Market moving toward technical correction
Analysts say the Nifty 50 is now approaching a technical correction zone. In market terms, a correction occurs when an index falls around 10 percent from its recent peak.
The Nifty had hit a record high on January 5 this year, and the current decline has pushed the index significantly below that level.
Volatility may continue
Market experts believe volatility may persist until crude oil prices stabilise and geopolitical tensions ease.
Investors have been advised to remain cautious and focus on long-term investment strategies, as global developments are likely to continue influencing Indian markets in the coming days.
About the author – Ayesha Aayat is a law student and contributor covering cybercrime, online frauds, and digital safety concerns. Her writing aims to raise awareness about evolving cyber threats and legal responses.
