The Indian stock market is experiencing a serious downturn on the third working day of the week. The BSE Sensex index plummeted by more than 600 points immediately after the market opened. At the same time, the National Stock Exchange's Nifty index also fell sharply, dropping below the 23,500 level, which dealt a significant blow to investors.
A notable decline was observed in the shares of information technology (IT) companies. A major drop was recorded for both TCS and Infosys. However, among the falling assets, stocks such as Paytm also showed growth.
Sensex and Nifty Open with Decline
The Sensex index from BSE began the trading session with a sharp decrease. This index of 30 stocks opened at 75,216, lower than the previous close of 75,577, and the rate of decline then accelerated significantly. By the time of writing, it had dropped by more than 609 points, reaching the mark of 74,968.
Parallel to the fall of the Sensex, the NSE Nifty index also showed a decline. NSE Nifty started at 23,522, which was below the previous close of 23,635, and then continued its rapid descent, trading at 23,477.
Sharpest Decline in IT Company Stocks
During the initial trading on Wednesday, IT company stocks faced the steepest decline. In the Nifty IT index, a drop of 3.06% was recorded. Among the companies showing the largest decrease were HCL Technologies (3.67%), Tech Mahindra (3.43%), TCS (2.88%), and Infosys (3.50%).
Companies that suffered the greatest losses in the IT sector also included Coforge, whose shares fell by 5.70%. Additionally, declines were recorded for Persistent Systems (2.42%), LTI Mindtree (2.52%), Amfaxis (2.32%), and Wipro (2.07%).
Main Reasons for the Fall, Including Crude Oil Prices
The reasons for the stock market collapse are linked to several factors. The sharp rise in global crude oil prices occurred due to escalating tensions in the Middle East and attacks on ships in the Strait of Hormuz. The price of Brent Crude approached $100, which once again increased the threat of inflation globally and worsened sentiment in the stock market.
Furthermore, geopolitical tension intensified due to the trade war between the US and Canada. Canada imposed tariffs of up to 50% on American goods, while Trump announced additional tariffs on a wide range of Canadian goods by the end of September. Attacks on ships in the Gulf also raised global tension to a high level.
Despite the overall slump, some stocks managed to generate profits for investors. These included Paytm Share, which rose by 4%, Medanta Share (+3.10%), Reliance Power Share (+2.50%), and NTPC Share (+1.10%).