Mumbai — Indian stocks ended sharply lower Monday as rising crude oil prices, escalating tensions in West Asia, higher global bond yields and continued foreign fund outflows weighed on investor sentiment.
The Sensex fell 1,124.02 points, or 1.52%, to close at 72,771.72, while the Nifty dropped 360.25 points, or 1.56%, to settle at 22,780.25.
Selling was broad-based, with declines across large-cap, mid-cap and small-cap shares. Tata Motors Passenger Vehicles, Power Grid and Jio Financial Services were among the biggest laggards on the Nifty.
The Nifty MidCap 100 fell 1.63%, while the Nifty SmallCap 100 declined 1.85%.
Investor sentiment remained weak amid concerns that the conflict in West Asia could further disrupt global energy supplies and add to inflationary pressures.
Markets reacted cautiously after U.S. President Donald Trump rejected an Iranian proposal aimed at reopening the Strait of Hormuz and easing hostilities. Iran, meanwhile, maintained that diplomacy remains the only solution to its conflict with the United States and Israel.
The geopolitical uncertainty also weighed on other Asian markets. South Korean stocks fell nearly 2%, Japan’s Nikkei slipped 0.10%, and Chinese equities dropped more than 1%.
Rising oil prices added to the pressure. Brent crude futures gained 2.2% to $106.60 a barrel, while U.S. West Texas Intermediate crude rose 1.45% to $93.76 a barrel.
Higher crude prices are a significant concern for India because of the country’s dependence on oil imports and the potential impact on inflation.
Global bond yields also moved higher as investors reassessed inflation risks. The yield on the U.S. two-year Treasury note rose five basis points to 4.90%, while the benchmark 10-year yield gained four basis points to 5.20%.
Higher yields in developed markets can reduce investor appetite for riskier emerging-market assets, including Indian equities.
Foreign portfolio investors also continued to weigh on domestic markets. After being net buyers in July and August, overseas investors turned net sellers in September.
According to NSDL data, foreign portfolio investors have sold Indian equities worth Rs 17,131 crore so far this month, taking their total net selling for the year to Rs 2.41 trillion.
The rupee also weakened, trading 0.19% lower at 96.00 against the U.S. dollar as a stronger dollar and higher crude prices pressured the currency. (Source: IANS)
