A tumultuous day shook the Indian equity market as the Sensex plummeted by a staggering 3,690 points, marking one of the most severe downturns in recent history.
· The tumultuous turn of events was triggered by early election trends indicating a closely contested battle between the NDA and the opposition INDIA bloc in the Lok Sabha elections.
· As the trading day progressed, the BSE’s market capitalization witnessed a significant erosion, plummeting to Rs 400 lakh crore by 11 a.m. from Rs 426 lakh crore at Monday’s closing bell.
· Adani Group stocks tumbled by up to 25% on June 4, erasing more than Rs 3 lakh crore from its market capitalization.
· The selloff in Adani Group stocks underscores the vulnerability of high-flying stocks to market sentiment shifts.
A tumultuous day shook the Indian equity market as the Sensex plummeted by a staggering 3,690 points, marking one of the most severe downturns in recent history. Investors bore the brunt of this market turmoil, witnessing approximately Rs 26 lakh crore evaporate from their portfolios amidst election uncertainty and adverse global cues.
The tumultuous turn of events was triggered by early election trends indicating a closely contested battle between the NDA and the opposition INDIA bloc in the Lok Sabha elections. This political ambiguity cast a shadow of uncertainty over the markets, prompting a widespread sell-off across sectors.
As the trading day progressed, the BSE’s market capitalization witnessed a significant erosion, plummeting to Rs 400 lakh crore by 11 a.m. from Rs 426 lakh crore at Monday’s closing bell. This rapid decline underscored the palpable unease gripping investors amid the unfolding electoral landscape.
The Sensex, mirroring the broader sentiment, nosedived to 72,740, shedding 3,690 points or 4.83%, while the Nifty mirrored this downward trend, plunging to 22,119, marking a decline of 1,144 points or 4.92%. The India Volatility Index (India VIX) surged by 33%, amplifying concerns over market volatility and risk aversion.
The stark contrast to the euphoria witnessed just a day earlier was evident as markets soared on the back of favorable exit poll predictions. Monday’s rally, which propelled the Sensex to close 2,507 points higher and the Nifty to end 733 points up, now seemed like a distant memory amidst the current turmoil.
The Adani Group, a prominent conglomerate, bore the brunt of this market carnage, witnessing a sharp decline in its stock prices. Adani Group stocks tumbled by up to 25% on June 4, erasing more than Rs 3 lakh crore from its market capitalization. This abrupt reversal came on the heels of substantial gains registered in previous trading sessions.
The selloff in Adani Group stocks, including Adani Total Gas, Adani Energy Solutions, Adani Power, and Adani Green Energy, underscores the vulnerability of high-flying stocks to market sentiment shifts. The conglomerate’s total market value, which surged to nearly Rs 20 lakh crore on the preceding trading day, now faced a significant erosion.
The market downturn was further exacerbated by a broad-based sell-off across sectors, with companies like Ambuja Cement, ACC, Adani Ports and SEZ, and NDTV witnessing substantial declines in their stock prices.
As the market grapples with uncertainty and volatility, investors brace themselves for continued turbulence, highlighting the importance of cautious investment strategies and risk management in navigating unpredictable market conditions.
(With inputs from agencies)
