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Indian equity markets remained under pressure on September 8, as rising hostilities between the US and Iran in the Persian Gulf pushed crude oil prices higher and added to concerns over the weakening rupee.
The Sensex fell 555 points to close at 75,577, while the Nifty declined 144 points to end at 23,635. Foreign funds continued to sell Indian stocks, adding to the pressure on domestic equities.
The latest decline took the Sensex's one-month loss to nearly 3,000 points, or 3.8%. Over the same period, the Nifty has fallen 949 points, or 3.9%.
Foreign investor activity also turned cautious. Since August 10, foreign investors have net bought Indian stocks worth Rs. 2,953 crore, according to combined data from NSDL and BSE.
However, the trend reversed sharply in September. Foreign funds have net sold stocks worth about Rs. 12,700 crore this month, putting further pressure on the market.
The rupee also remained under pressure despite a record USD 136-billion inflow into India through the Reserve Bank of India's special dollar deposit drive for NRIs.
According to Ankur Punj, MD, Equirus Wealth, renewed hostility between the US and Iran pushed investors towards a low-risk stance on equity assets.
“Mirroring weak global cues, domestic markets extended their losing streak Tuesday amid selling in banking, IT, oil and gas and realty shares. Increasing tension in West Asia triggered a sharp rise in crude oil prices, while depreciation in the local currency against the dollar also dampened the overall market sentiment,” he added.
The drop in the market value led to losses worth approximately Rs. 35,000 crore for the investors today. The current market capitalisation of BSE is Rs. 486.2 lakh crore.
As far as the Sensex stocks are concerned, the companies that caused the maximum loss include ICICI Bank, HDFC Bank, and Reliance Industries. Nevertheless, purchases in BEL, Hindustan Unilever, and Adani Ports helped in preventing the downfall of the index.
Also Read: Stock Market Update: Nifty 50 Opened 0.48% Lower, Sensex Fell 361.36 Points
In a weakening trend, the rupee that was stable for two consecutive days, fell to end at 94.83 per US dollar, down 34 paise against its previous close. “Rupee fell in a risk-off environment along with high crude oil prices and aggressive dollar buying,” commented Dilip Parmar of HDFC Securities.
