Investors lose over ₹15 lakh crore in six trading sessions as NIFTY50, SENSEX plunge over 3%
Upstox
3 min read • Updated: May 9, 2024, 5:58 PM
Summary
The Indian stock market witnessed significant volatility on May 9, with both the NIFTY 50 and BSE SENSEX plummeting over 1% to hit two-month lows. NIFTY 50 closed at 21,957.50, down 345 points, while SENSEX ended at 72,404.17, down 1062 points. The downward trend persisted for five consecutive trading days, resulting in nearly 3% loss for NIFTY 50 and 2% for SENSEX.
The domestic markets continued to see volatility on Thursday, May 9, with benchmark indices ending at two-month lows. Both NIFTY 50 and BSE SENSEX dropped more than 1% each at close.
Sensex declined over 1000 points, while the NIFTY shed over 300 points at close. NIFTY settled at 21,957.50, down 345 points or 1.55%, while SENSEX ended at 72,404.17, down 1062 points or 1.45%.
Amid the weakness seen in the border market, except NIFTY Auto all other sectoral indices closed in red, with NIFTY Oil & Gas and Metal among top losers.
NIFTY 50 has been on a downward trend since the past five trading days, shedding almost 3% during the period. BSE SENSEX, on the other hand, has extended losses for the third straight day, eroding almost 2% during this period.
Among the NIFTY50 index, Hero MotoCorp (+3.1%), Tata Motors (+1.7%), M&M (+1.5%) were top gainers today, while L&T (-5.6%), BPCL (-4.5%), Asian Paints (-4.4%) were top losers.
Broader market indices also declined in tandem with their headline counterparts, with NIFTY Midcap 100 declining 927 points, or 1.85%, on Thursday. NIFTY 500 also dropped 360 points, 1.74% while NIFTY Smallcap settled 465.35 points or 2.83% lower.
In the recent market crash, investors wealth eroded by over ₹15 lakh crore. On May 7, around ₹5.5 lakh crore of investors’ money was wiped out triggered by broad sell-off. On May 9, the investors lost around ₹2.2 lakh crore as the benchmark indices extended the losses.
Indian markets’ volatility index India VIX has remained high for 10 out the past 11 trading sessions, rising sharply by over 12% on Thursday.
Factors behind recent market crash
Heavy sell-off by FIIs
The decline in Indian benchmarks was witnessed amid heavy sell-off by foreign institutional investors (FIIs). So far in May, the FIIs have been net sellers, withdrawing over ₹15,863 crore from the Indian market. They sold equities worth ₹35,692 crore in April 2024.
Investors remain cautious over Q4 results
Besides the extended offloading of equities by the FIIs, domestic retail investors are treading cautiously in earnings season after mixed Q4 results.
Uncertainty ahead of Lok Sabha elections 2024
Markets often witness a downward trend in the election season. As the campaigning for general elections 2024 is underway Dalal Street keeps a keen watch on the political developments leading up to the announcement of results.
As per experts, low voter turnout in general elections so far could affect the outcome for a few constituencies.
Geopolitical tensions Concerns relating to ongoing tensions in the West Asia and Russia-Ukraine war are also weighing on the global market sentiments including domestic markets.
Experts are of the view that markets could continue remaining choppy until the election results are out, accompanied by intraday pullbacks as well as pushbacks in the near term.