Why is market falling today? Sensex drops 600 points, Nifty below 22,600. Key factors behind Rs 5 lakh crore rout

The Indian stock market extended sharp losses on Thursday, with Sensex and Nifty dropping nearly 1% each as investors braced for expiry-day volatility.

Sensex dropped over 600 points to fall below 73,100 and Nifty 50 lost 224 points to fall below 22,600 on Thursday morning. The drop wiped off nearly Rs 5 lakh crore from the total market capitalisation of all companies listed on BSE, dragging it down to Rs 457 lakh crore.

Power Grid shares dropped around 3% to lead losses on Sensex, while Tata Steel, Maruti Suzuki, BEL, Asian Paints, M&M, Adani Ports, Bajaj Finserv, Trent, Sun Pharma, NTPC, UltraTech Cement, Bajaj Finance, HUL,. IndiGo, ITC, HDFC Bank, Reliance Industries and Titan fell 1-2% each. Bucking the trend, Eternal shares gained nearly 1%.

Broader markets plunged deeper into the red, with Nifty Smallcap 100 and Nifty Midcap 100 indices falling nearly 2% each. This came as India VIX, which measures volatility in the market, jumped nearly 6% to 16.60.

Among the sectors, Nifty Auto, Nifty FMCG, Nifty Metal and Nifty Pharma plunged around 2% each. All sectoral indices are currently in the red. The overall market breadth continued to remain negative, with NSE seeing 510 advances and 2,348 declines, while 99 stocks remained unchanged.

Here are the key factors pushing the market down today.

Oil prices rose around 2% to near $111 per barrel mark again on Thursday as a drone strike on a Saudi Aramco oilfield triggered concerns that the escalating conflict in West Asia could disrupt supplies. Brent crude futures jumped more than $2 to trade at around $110.7 per barrel. WTI Crude futures also gained more than a dollar to trade at around $99 per barrel.

The latest escalation also prompted the United States to order some diplomats and their family members to leave its missions in Saudi Arabia. Iranian Foreign Minister Abbas Araqchi told the Financial Times on Wednesday that Tehran was fully prepared to defend itself. President Masoud Pezeshkian also told state media that the United States could not expect dialogue while continuing to blockade and threaten Iran. The escalating tensions are triggering worries of further supply disruptions in oil shipments.

More to come...