Stock market crash today: Nifty50 and BSE Sensex, the Indian equity benchmark indices, crashed in trade on Wednesday as fresh tensions between the US and Iran sent crude oil prices soaring. Both the benchmarks tumbled around 2%.Selling pressure gathered pace during the second half of the session after US President Donald Trump declared that the interim agreement with Iran to end the conflict was “over,” reigniting fears of further escalation in the Middle East.The sharp market decline erased nearly Rs 8 lakh crore in investor wealth, pulling the combined market capitalisation of all companies listed on the BSE to Rs 471 lakh crore.Selling was broad-based across sectors, with the Nifty Bank, Nifty FMCG and Nifty Oil & Gas indices each dropping more than 2%.
Why is stock market down today?
1) Trump declares Iran ceasefire overInvestor sentiment turned sharply negative after US President Donald Trump announced that the ceasefire arrangement with Iran had collapsed, calling the understanding “over” and describing Iranian leaders as “sick people.” The comments came amid a fresh escalation in the Gulf, raising fears that tensions in the Middle East could intensify once again.2) Crude oil prices jumpCrude oil prices rallied sharply as escalating geopolitical tensions reignited fears of supply disruptions through the Strait of Hormuz. Brent crude futures climbed nearly 5% to $ 78.09 a barrel.3) Weak global market sentimentIndian equities tracked the broad weakness across global markets as escalating geopolitical tensions triggered a wave of risk aversion among investors.European stocks came under heavy selling pressure following President Donald Trump’s remarks, with the UK’s FTSE 100, France’s CAC 40 and Germany’s DAX declining by as much as 2%. Asian markets also ended sharply lower. Japan’s Nikkei lost 1.5%, while South Korea’s Kospi tumbled 6% amid an intensified selloff in semiconductor stocks.US markets also appeared headed for another weak session. After Wall Street’s steep overnight decline, Dow Jones futures were down about 1%, pointing to a subdued opening later in the day.4) US bond yields edge higherRising US Treasury yields added to the cautious mood in equity markets. The benchmark 10-year Treasury yield climbed to 4.565%, while the 30-year yield rose to 5.068%. The policy-sensitive two-year Treasury yield also moved higher to 4.197%.Higher bond yields tend to enhance the appeal of fixed-income investments relative to equities, often prompting investors to reduce exposure to riskier assets such as stocks.5) Rupee comes under pressureThe Indian rupee weakened beyond the 95.50 mark against the US dollar, declining 0.6% from its previous close as rising crude oil prices and a stronger US currency weighed on the domestic unit.Jateen Trivedi, Vice President – Research Analyst (Commodity & Currency) at LKP Securities, had earlier projected the rupee to trade in the 94.60-95.30 range, with crude oil prices and foreign institutional flows expected to remain the key drivers. The move beyond the upper end of that range suggests increasing pressure on the Indian currency.(Disclaimer: Recommendations and views on the stock market, or any other asset classes or personal finance management tips given by experts and analysts are their own. These opinions do not represent the views of The Times of India.)