Indian equities came under intense pressure on March 27, with benchmark indices tumbling over 2 percent amid escalating global uncertainties and sustained foreign outflows.
The Sensex plunged 1,690 points, or 2.25 percent, to close at 73,583, while the Nifty 50 dropped 487 points, or 2.09 percent, to settle at 22,819.60. Broader markets were also hit, with the BSE Midcap index declining 2.18 percent and the Smallcap index falling 1.82 percent.
The latest fall extends the losing streak of both indices to five consecutive weeks.
Investor wealth eroded sharply, with the total market capitalisation of BSE-listed firms shrinking by about ₹9 lakh-crore in a single session to ₹422 lakh-crore from ₹431 lakh-crore previously.
Muted global sentiment weighed on domestic markets. Key Asian indices such as Japan’s Nikkei and South Korea’s Kospi declined, while major European markets in the UK, Germany and France also traded lower.
Persistent uncertainty surrounding the West Asian conflict has kept investors cautious across global markets.
Conflicting signals on the US-Iran-Israel situation continue to cloud market outlook.
While US President Donald Trump has delayed potential strikes on Iran’s energy infrastructure until April 6, concerns remain that Israel could intensify its offensive before the conflict concludes.
Market participants fear a prolonged conflict could keep energy prices elevated, worsening India’s macroeconomic outlook.
The Indian rupee weakened sharply, hitting a record low of 94.85 against the dollar during the session. The currency has depreciated around 4 percent since the conflict escalated late last month.
A weakening rupee typically triggers foreign capital outflows and adds pressure on equity markets.
Brent crude prices surged towards the $110 per barrel mark, heightening fears of inflation and pressure on corporate margins.
Elevated oil prices are expected to delay earnings recovery for India Inc., with global brokerage Goldman Sachs cutting earnings growth estimates to 8 percent for 2026 and 13 percent for 2027.
Foreign portfolio investors continued to pull out funds aggressively. Data from NSDL shows FPIs have withdrawn ₹1,23,688 crore from Indian markets so far in March.
FPI equity assets also saw a steep decline, reflecting risk aversion amid rising crude prices and currency weakness.
Analysts expect volatility to persist in the near term, with markets likely to remain sensitive to developments in West Asia, crude oil movements and currency trends.
A sustained easing in geopolitical tensions and stabilisation in crude prices will be key triggers for any meaningful market recovery.
(By arrangement with livemint.com)