S&P tumbles 6% as global sell-off jolts Indian markets
The global financial markets witnessed a massive sell-off on Monday, with the S&P 500 plunging 6% to mark its worst day since March 2020. This sudden downturn has triggered a global rout, with Indian indices following suit. The Sensex dropped over 2,200 points, while IT and pharma stocks took a beating due to growing recession fears.
The US markets have been struggling for the past few days, with the S&P 500 experiencing its third consecutive day of losses. The Nasdaq, which is heavily weighted with technology stocks, has entered bear territory, with many investors bracing for continued volatility across markets worldwide.
The sell-off in the US markets was triggered by a combination of factors, including concerns over inflation, the impact of the Ukraine-Russia conflict on global growth, and the Federal Reserve’s plan to raise interest rates to combat rising prices. These concerns have led to a sharp sell-off in technology and growth stocks, which have been the darlings of the market in recent years.
The Indian markets were not immune to the global sell-off, with the Sensex plummeting over 2,200 points to close below the 52,000 mark. The Nifty50 also dropped over 650 points to close below the 15,500 mark. The IT and pharma sectors, which are major contributors to India’s GDP, were among the worst-hit, with stocks like TCS, Infosys, and Wipro falling by up to 5% each.
The IT sector has been one of the most affected due to concerns over the impact of recession on global demand. Many analysts believe that the IT sector is highly dependent on global economic growth, and any slowdown in growth could lead to a decline in demand for IT services.
The pharma sector was also hit hard, with stocks like Sun Pharma, Dr Reddy’s, and Cipla falling by up to 4% each. The pharma sector has been under pressure due to concerns over the impact of the Ukraine-Russia conflict on global supply chains and the potential for increased regulation in the wake of the pandemic.
The sell-off in the Indian markets was exacerbated by the rupee’s weakness against the US dollar. The rupee fell to a record low of 77.20 against the US dollar, making imports more expensive and increasing the burden on Indian companies.
The Indian government has been trying to address the concerns over the economy, with the finance minister recently announcing a series of measures to boost economic growth. However, the measures have not been enough to stem the tide of the sell-off, and the Indian markets are likely to remain volatile in the near term.
The global sell-off has also had an impact on other emerging markets, with stocks in China, Brazil, and South Africa also falling sharply. The sell-off has been exacerbated by concerns over the impact of the Ukraine-Russia conflict on global growth and the potential for increased regulation in the wake of the pandemic.
In conclusion, the recent sell-off in the global markets has been a major concern for investors, with the S&P 500 plunging 6% to mark its worst day since March 2020. The Indian markets have also been hit hard, with the Sensex dropping over 2,200 points. The IT and pharma sectors have been among the worst-hit, with stocks falling by up to 5% each. The sell-off has been exacerbated by concerns over the impact of recession on global demand and the potential for increased regulation in the wake of the pandemic.
Source:
https://www.thecore.in/podcasts/us-stocks-whacked-for-the-third-day-833088
