S&P Tumbles 6% as Global Sell-off Jolts Indian Markets
The global financial markets have been witnessing a sudden and sharp decline in recent days, with the S&P 500 index plunging a whopping 6% on the third consecutive day of losses. This marks the worst day for the S&P 500 since March 2020, when the pandemic was spreading rapidly across the world. The sharp decline in the US markets has triggered a global rout, with Indian indices following suit.
The Sensex, the benchmark index of the Indian stock market, tumbled over 2,200 points, wiping out all the gains made in the past week. The Nifty50, which is a widely followed index of the Indian stock market, also plunged by over 7%. The decline in the Indian markets was widespread, with all the sectoral indices trading in the red.
The sharp decline in the Indian markets is not surprising, given the close links between the Indian and US markets. The S&P 500 is a widely followed index in India, and any significant decline in the US markets usually has a ripple effect on the Indian markets.
The reasons behind the sharp decline in the S&P 500 are complex and multifaceted. One of the main reasons is the rising fears of a global recession. The US Federal Reserve has been raising interest rates to combat inflation, which has led to a decline in the value of stocks. The rising interest rates have also led to a decline in the value of the US dollar, making it more expensive for foreign investors to invest in the US market.
Another reason for the decline in the S&P 500 is the decline in the value of technology stocks. Technology stocks have been a major driver of the stock market in recent years, but they have been under pressure in recent days due to concerns over their valuations. The decline in the value of technology stocks has led to a decline in the S&P 500, as technology stocks make up a significant portion of the index.
The decline in the S&P 500 has also been exacerbated by the decline in the value of oil prices. Oil prices have been declining in recent days due to concerns over a global economic slowdown. The decline in oil prices has led to a decline in the value of energy stocks, which has in turn led to a decline in the S&P 500.
The Indian IT and pharma sectors have also been under pressure in recent days, due to concerns over their valuations. The Indian IT sector has been under pressure due to concerns over the impact of the US-China trade war on the industry. The Indian pharma sector has also been under pressure due to concerns over the impact of the US-China trade war on the industry.
The decline in the Indian markets has led to a decline in the value of the rupee against the US dollar. The rupee has been declining in recent days due to concerns over the impact of the US-China trade war on the Indian economy. The decline in the value of the rupee has led to a decline in the value of Indian stocks, making them less attractive to foreign investors.
The decline in the Indian markets has also led to a decline in the value of gold. Gold has been a safe-haven asset for investors in times of uncertainty, but it has been under pressure in recent days due to concerns over the impact of the US-China trade war on the global economy. The decline in the value of gold has led to a decline in the value of the Indian rupee, making it more expensive for foreign investors to invest in the Indian market.
In conclusion, the S&P 500’s 6% decline has triggered a global rout, with Indian indices following suit. The reasons behind the decline are complex and multifaceted, but they can be broadly attributed to rising fears of a global recession, concerns over the valuations of technology stocks, and the decline in the value of oil prices. The Indian IT and pharma sectors have also been under pressure, due to concerns over their valuations. The decline in the Indian markets has led to a decline in the value of the rupee against the US dollar, making Indian stocks less attractive to foreign investors. With the Nasdaq in bear territory, investors are bracing for continued volatility across markets worldwide.
News Source:
https://www.thecore.in/podcasts/us-stocks-whacked-for-the-third-day-833088
