Sensex Declines by 460 Points Amid Rising Crude Prices
The Sensex and Nifty indices fell for the third consecutive day, influenced by escalating crude oil prices and weak global markets.
Sensex closed at 73,249.39, down 460.30 points.
Brent crude oil prices surged to USD 112 per barrel due to geopolitical tensions.
The Indian rupee weakened against the US dollar, closing at 94.50.
On Thursday, the Indian equity markets faced significant declines, with the Sensex dropping 460.30 points to settle at 73,249.39 and the Nifty falling 123.70 points to close at 22,687.65. This marks the third consecutive session of losses, primarily driven by rising crude oil prices and negative sentiment from Asian markets.
The surge in crude oil prices, particularly Brent crude which rose by 3 percent to USD 112 per barrel, has been attributed to renewed attacks by Yemen's Houthi rebels in Saudi Arabia. This geopolitical instability prompted the United States to evacuate some of its diplomats from the region, further heightening market concerns. The increase in oil prices has adversely affected sectors including oil marketing, paint manufacturing, and tyre production.
In addition to crude oil prices, the Reserve Bank of India's recent monetary policy minutes indicated that further interest rate hikes may be necessary to combat inflation, although aggressive tightening was not fully endorsed due to potential risks to economic growth. This uncertainty, combined with weak performance in Asian markets—where South Korea's Kospi fell 3.12 percent and Japan's Nikkei 225 dropped 1.94 percent—contributed to the bearish trend in Indian equities.
The Indian rupee also faced pressure, depreciating by 12 paise to 94.50 against the US dollar, influenced by the overall weakness in domestic equity markets and rising crude prices. The India VIX, a gauge of market volatility, increased by nearly 6 percent, reflecting heightened investor anxiety.
Looking ahead, analysts suggest that the Nifty index needs to reclaim the 22,800 mark to establish a more stable outlook. Immediate support is seen between 22,600 and 22,550, and a sustained drop below 22,500 could lead to increased selling pressure. Market participants will be closely monitoring global cues and domestic economic indicators in the coming days to gauge the potential for recovery.
