On Thursday, the Indian stock market fell sharply. It was as if an earthquake had hit Dalal Street. The Sensex fell 570 points to close below 72,000. While the Nifty fell by 199 points to close at 22,421. Due to this sharp sell-off, the market cap of BSE-listed companies fell to Rs. 465 lakh crore has become. It means that almost 6 lakh crore rupees of investors were ruined in one go.

At one point during trading, the Sensex fell 1200 points to touch a 52-week low of 71,292. At that time, 10 lakh crore rupees of investors were at stake. On the NSE, 2789 stocks declined, while only 594 stocks gained. Nifty midcap, smallcap indices also fell by around 2 percent. Such was the atmosphere of fear in the market that the India VIX, a measure of volatility, jumped more than 12 percent. Amid this heavy selling, only a few stocks like HDFC Bank, Kotak Mahindra Bank made some efforts to keep the market under control.

Why did the market fall?

The biggest hit to the market has been given by foreign investors (FIIs). On Wednesday alone, foreign investors invested Rs. 10,148 crore worth of shares were sold. So far this week, the figure is Rs. 26,000 crore has been reached. Market sentiment has completely soured due to inflow of foreign money.

On the other hand, American bond yields are continuously increasing. The 10-year Treasury yield rose to 5.31 percent, the highest since 2007. As bond yields rise, investors are pulling money out of the stock market and investing it in safer places. Apart from this, weakness was also seen in the rupee against the dollar. The rupee fell to 95.98 per dollar, adding to the pressure.

Big disaster in auto stocks

The auto sector also played a major role in bringing down the market. The Nifty Auto Index fell over 4 percent. Shares of Mahindra and Maruti Suzuki were the biggest losers. Auto sales figures for the month of September did not live up to market expectations. Which had a direct impact on the shares of the companies.

Technically, Nifty broke its important support level of 22,500 and came lower. Derivatives research experts had already warned that if the 22,500 level breaks, the Nifty could slide to 22,400. Axis Securities also believes that the break of this support has led to a sell-off in the market.

25 year old record broken

Stocks falling for the eighth consecutive week is a matter of great concern for the market. This is the first time since the dot-com crash of 2001 that the market has been in a sustained decline for so long. It has also surpassed the financial crisis of 2008 and the Covid crash of 2020. Although foreign investors are withdrawing money from the stock market, they are investing in the primary market, which is a different trend.

Market experts believe that this is a short-term phase of the market. Further corrections are expected with Brent crude prices falling below $98. Experts advise that for long-term investors, this could be a great opportunity to buy quality shares of large companies at cheap prices.