NIFTY, SENSEX tumble over 0.5%; investors lose over ₹5 lakh crore: Key factors behind today’s sell-off

Benchmark stock indices SENSE and NIFTY tanked more than 1% in intraday trade on Thursday, November 21, following deep selling in Adani Group shares, Reliance Industries and ITC.

The 50-issue NIFTY plunged by 255 points, or over 1%, to hit a low of 23,263.15 before recovering some of its losses later in the pre-close session.

Reliance Industries, Adani Ports, ITC and NTPC were the major drag on stock indices. Metal, Media, PSU banks, FMCG, Oil& Gas and Auto were among the major sectoral losers.

Nearly ₹2.9 lakh crore of investors’ wealth was wiped out in a single session amid the free fall in Adani Group shares, as the total market capitalisation of the BSE listed companies dropped to ₹426.5 lakh crore compared to ₹431.9 lakh crore on November 19.

Adani Group shares tank following bribery charges in the US

Adani Group shares tanked up to 20% on Thursday after billionaire group chairman Gautam Adani was charged in the US over his alleged role in paying $250 million in bribes to Indian officials in exchange for solar power contracts.

Some of the Adani Group companies hit the lower circuit. Adani Enterprises plunged up to 20%, Adani Energy Solutions by 20%, Adani Green Energy up to 19.17 %, Adani Total Gas up to 18.14%, Adani Power up to 17.79%, and Adani Ports up to 15% on the NSE. Ambuja Cements (14.99%), ACC (14.54%) and NDTV (14.37%) also declined. Adani Entertainment and Adani Ports were major losers among NIFTY50 stocks.

Russia-Ukraine war

A flare-up in geopolitical worries after the US allowed Ukraine to fire its long-range missiles deep inside Russia triggered the selling of riskier assets, including emerging markets like India.

Ukraine fired around 12 British missiles into Russia, raising fears of a sharp rebuttal by Moscow. Ukraine stated that Russia has fired an intercontinental ballistic missile on it.

Crude oil spike hit oil shares

A spike in crude oil prices hit oil shares. High prices fueling inflation concerns also triggered selling in FMCG and auto shares. Brent crude rose by over 1% to $73.56 per barrel on Thursday.

Unabated FII selling

FIIs continue to remain net sellers in Indian equities due to a host of reasons. High valuation of Indian equities, weaker than expected Q2 results and resultant EPS downgrades have led to exit of FIIs from Indian stocks. FIIs have sold shares worth over ₹34,300 crore on net basis this month so far.

US futures decline on weaker Nvidia forecast

A fall in US futures following a disappointing revenue forecast by Nvidia also hit the market sentiment. Chip major Nvidia projected revenue to grow at a slower pace than seen in previous quarters. Supply constraints, especially in the upcoming Blackwell line of AI chips, were cited as the major reason.