Investors lose Rs 10 trillion in the worst stock market crash since Aug 5

The stock market today fell due to escalating geopolitical tensions in the Middle East, recent regulatory changes in the F&O segment by Sebi and strength in the China stock market

Stock market crash today: In the aftermath of the bloodbath at the Dalal-street on Thursday, investors lost a total of Rs 9.7 trillion in market capitalisation on the Bombay Stock Exchange (BSE). At Tuesday's close, the total market capitalisation of companies listed on the BSE stood at around Rs 474 trillion - this was pulled down to Rs 465 trillion on Thursday. 

However, in intraday deals, investors losses mounted to Rs 10.56 trillion with the total market capitalisation of the BSE slipping to Rs 464 trillion. 

The market breath also favoured the declines as around 2,875 stocks traded losses versus advances by 985 stocks, with 109 remaining unchanged. 

In terms of contribution to the 30-blue chip stock index, BSE Sensex’s decline, HDFC Bank, Reliance Industries, Larsen and Toubro, Axis Bank and ICICI Bank led the way, pulling Sensex down in its sharpest decline since August 05. The BSE Sensex plunged 1,832 points or 2.17 per cent to 82,434 level in intraday deals. 

Meanwhile, Nifty50 slipped to an intraday low of 566 points, down 2.19 per cent to 25,230.30 level in intraday trade. That apart, the country's volatility indicator, India VIX jumped to 11.72 per cent. 

Among sectors, Nifty Realty was clear loser ending the day 4.36 per cent lower and was followed by Nifty Auto slipping 2.88 per cent, Nifty Private Bank declining 2.61 per cent and Nifty Financial Services sliding 2.59 per cent. 

According to analysts, today’s sharp decline was driven by several negative factors, including escalating geopolitical tensions in the Middle East, recent regulatory changes in the F&O segment by Sebi and strength in the Chinese market, following the People’s Bank of China (PBoC) stimulus package. 

“Speculation is growing that Israel may retaliate by targeting major oil fields in Iran, which could further fuel the rise in oil prices. Additionally, recent regulatory changes in the F&O segment by SEBI are expected to impact trading volumes, as retail participation may decline due to the increased contract size and limits on weekly expiries,” said Vishnu Kant Upadhyay, AVP, research & advisory at Master Capital Services.

Analysts also concurred that the foreign money is being diverted from India to China as the country became attractive to investors following its government’s stimulus package. 

“There has been a notable outflow of Foreign Institutional Investor (FII) money from India to China over the past few days, exerting pressure on large-cap stocks. Lastly, profit booking ahead of state elections and concerns over elevated valuations have added to the downward pressure,” stated Santosh Meena, head of research, Swastika Investmart.