Mumbai, August 5 – A bloodbath ensued on Dalal Street today as the benchmark Sensex plummeted by nearly 2,400 points, reflecting a deep-seated panic among investors. The steep decline was primarily triggered by mounting concerns over a potential recession in the United States.
The BSE’s 30-share Sensex opened with a sharp drop of 2.95%, erasing gains made in recent weeks. The broader Nifty 50 index also suffered a significant setback, losing over 2%.
Market experts attribute the sharp downturn to a combination of factors, including weak US job data released earlier in the day, which has intensified fears of a slowing global economy. The possibility of a recession in the US, a major trading partner for India, has cast a shadow over investor sentiment.
“The market is clearly reacting to the growing uncertainty around the global economic outlook,” said Mr. Vinoy, a market analyst. “The US job data has raised red flags, and investors are adopting a risk-off stance.”
Market experts believe that the current market turmoil is a direct response to the growing uncertainty around the global economic outlook. While it remains unclear if this is a temporary correction or the beginning of a more prolonged downturn, analysts unanimously advise investors to exercise caution and avoid impulsive decisions.
All major sectors witnessed heavy selling pressure, with banking, IT, and auto stocks bearing the brunt of the decline. Market capitalization eroded by a substantial amount as investors rushed to offload their holdings.
The India VIX, a measure of market volatility, surged dramatically, indicating heightened anxiety among investors.
Asian shares also tumbled as traders braced for increased global volatility in the wake of the US job data. Markets in Hong Kong, Shanghai, and Tokyo all experienced significant declines.
While it remains to be seen if this is a temporary setback or the beginning of a more prolonged market correction, analysts caution investors to exercise prudence and avoid panic selling.
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