There was a huge fall in the Indian stock market, in which both the benchmark indices Sensex and Nifty fell by more than 1 percent. The mood of investors got spoiled due to increasing uncertainty regarding Iran-America war, continuous selling by FIIs and other reasons. By 9.35 am, the Sensex fell 890 points to 73,759.94, while the Nifty 50 fell 239 points to 23,244.45. This came as India VIX, which measures market volatility, jumped more than 8 per cent during trading to 16.62.
There was a decline in IT shares today after a tremendous rise. Shares of Tata Consultancy Services (TCS), HCL Tech, Tech Mahindra and Infosys fell 2-5%, leading to the biggest losses in the Sensex. At the same time, Adani Port was the biggest gainer by increasing by 1 percent. The atmosphere of decline in the market was visible everywhere. Nifty Midcap 100 and Nifty Smallcap 100 indices fell 0.7% and 0.5% respectively. Sector-wise, Nifty IT was the biggest loser, falling 4%. About 1,634 shares declined on NSE, while 913 shares rose and there was no change in 84 shares.
The special thing is that due to this decline, there was a loss of Rs 4,47,165.35 crore in the valuation of the stock market. A day ago, the valuation of BSE was Rs 4,62,67,787.61 crore, which came down to Rs 4,58,20,622.26 crore within about 20 minutes. This means that investors have suffered huge losses. Let us also tell you what are those 6 reasons due to which a big decline is being seen in the stock market.
Iran-America tension increased
Despite US President Donald Trump’s confidence that the US and Iran are moving closer to ending their three-month-long war and reopening the Strait of Hormuz, tensions continue to rise in the oil-rich Middle East. Israel continues attacks on Lebanon, threatening the fragile ceasefire between Washington and Tehran, while Iran has fired missiles at neighboring countries.
Meanwhile, the US military on Tuesday said it had “successfully repelled” a series of Iranian missile and drone attacks in the Gulf and launched self-defense strikes on the country’s Qeshm island. CENTCOM also said three attack drones launched by Iran “toward civilian sailors” had been shot down.
Oil prices increased
As a result of the tension, oil prices increased. Brent crude futures were up nearly 1% to trade near $97 a barrel. Meanwhile, WTI crude futures were also up nearly 1% to trade near $95 per barrel. The weakening ceasefire in the Middle East has increased concerns about the long-term closure of the Strait of Hormuz. It is a narrow 33-kilometre waterway that connects the Persian Gulf to the Gulf of Oman and transports more than 20 percent of the world’s daily oil and gas shipments.
rupee weakened
The rupee fell 14 paise to 95.50 against the US dollar in early trade on Wednesday. Jatin Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities, said higher crude oil prices are raising concerns about India’s import bill and inflation outlook, keeping sentiment in the forex market cautious. He further said that going forward, the market will closely monitor the outcome of RBI policy… The movement of the rupee will continue to be influenced by the dollar index, crude oil prices and capital flows. Technically, 94.85 remains an important resistance level, while 95.75 is the next major support area.
FII selling continues
Foreign investors remained net sellers of Indian equities. On Tuesday, he sold shares worth about Rs 8,363 crore on Dalal Street. This follows massive selling of Rs 22,102 crore in just one session on May 29 and Rs 3,843 crore off-loading on June 1.
Increase in bond yields
US Treasury yields rose slightly amid recent geopolitical developments. The yield on the benchmark US 10-year note rose to 4.457%, while the yield on the 30-year bond rose to 4.97%. The yield on the 2-year note, which typically moves along with the Federal Reserve’s interest rate expectations, rose to 4.056%. A rise in bond yields generally makes bonds more attractive to investors, which in turn may lead to some decline in the markets.
Fall in IT shares
The fall in the market could also be due to heavy selling in IT shares. Earlier, these stocks had seen a rise in several consecutive sessions, despite fluctuations in the overall market. The Nifty IT index jumped more than 4 percent on Tuesday and registered the highest single-day gain since May 2026. The index rose by about 8 percent in just three sessions, while Nifty 50 declined by 2 percent during the same period. Due to this sharp rise, there might have been some profit booking in big IT stocks today, which affected the sentiment of the entire market.
What are the experts saying?
VK Vijayakumar, Chief Investment Strategist of Geojit Investments, said that due to a slight increase in the ongoing conflict in West Asia, Brent crude prices have again increased to near $ 97, which indicates that India is not going to get any relief from the energy crisis. RBI’s policy announcement on June 5 will be closely watched by the market.
He further said that the boom period in the countries with big semiconductor companies – South Korea and Taiwan – is continuing without any interruption. He explained that big companies like Samsand, SK Hynix and TSMC, which have a strong hold on prices, are expected to make huge profits this year and probably next year too. It is a fact that along with these markets, the bullish phase in the markets of America and Japan is also going on due to the expectations of huge increase in profits.
On the contrary, Vijayakumar said that the pace of profit growth in India may be a bit slow in the financial year 2027, due to slow economic growth rate and rising inflation. He also said that all these reasons have affected the market environment. It is a matter of relief that the confidence shown by retail investors is that despite difficult circumstances, they are continuously investing money. Even though continued FPI outflows are a major hurdle, right valuations, earnings growth seen in Q4 numbers and strong domestic investment inflows can strengthen the market.
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