MUMBAI: Equity benchmark Sensex tumbled more than 1,000 points on Monday, sinking below the 77,000 mark as global markets witnessed a sell-off and crude prices spiked. Investor sentiment took a further hit from strong US jobs data, which tempered expectations of early rate cuts, a sharp fall in the rupee, and continued foreign fund outflows.
Extending its losing streak to four sessions, the 30-share BSE Sensex slumped 1,048.90 points or 1.36 per cent to close at 76,330.01. During the session, it nosedived 1,129.19 points or 1.45 per cent to touch 76,249.72. The NSE Nifty shed 345.55 points or 1.47 per cent, ending at 23,085.95.
Key drags
Among the Sensex pack, Zomato plunged nearly 7 per cent, while Power Grid, Adani Ports, Tata Steel, NTPC, Tata Motors, Tech Mahindra, Mahindra & Mahindra, Asian Paints, Sun Pharma, and UltraTech Cement also posted significant losses.
On the other hand, Axis Bank, Hindustan Unilever, Tata Consultancy Services, and IndusInd Bank emerged as gainers.
Triggers
The sell-off in global markets spilled over to domestic equities following strong US payroll data, which dampened hopes of rate cuts in 2025. This strengthened the dollar, pushed up bond yields, and reduced the appeal of emerging markets.
Additionally, recent GDP downgrades and slowing earnings amid high valuations have weighed on investor sentiment,” said Vinod Nair, Head of Research at Geojit Financial Services.
In global markets, Seoul, Shanghai, and Hong Kong ended in the red, while Japan’s markets were closed for a holiday. European bourses also traded lower, and US markets closed on a weak note on Friday.
Rupee and crude impact
Foreign institutional investors (FIIs) continued their sell-off, offloading equities worth Rs2,254.68 crore on Friday. So far this month, FIIs have pulled out Rs22,194 crore from Indian equities.
“The US sanctions on Russian oil exports pressured the rupee to a new low against the dollar, triggering a sharp correction in domestic equities as foreign investors exited. The broad-based selling, including heavy exits in mid and small-cap stocks, exacerbated market declines.
The rupee recorded its steepest single-day drop in nearly two years, sliding 58 paise to close at an all-time low of 86.62 against the dollar. Meanwhile, Brent crude oil rose 1.43 per cent to $80.90 a barrel, stoking concerns about inflationary pressures that could delay any rate cuts by the Reserve Bank of India (RBI).
Economic data
On the brighter side, India’s industrial production (IIP) growth surged to a six-month high of 5.2 per cent year-on-year in November 2024, driven by festive demand and a rebound in manufacturing activity, according to official data released on Friday.
The Sensex had previously declined 241.30 points or 0.31 per cent to 77,378.91 on Friday, while the Nifty fell 95 points or 0.40 per cent to 23,431.50.
