Stock Market Crash: ₹12 Lakh Crore Vanishes Amid Virus Fears

Domestic stock market indices saw a sharp decline today, with the Sensex shedding 1,258 points and the Nifty losing 388 points, following renewed fears over the spread of the Human Metapneumovirus (HMPV) in India. The market lost around ₹12 lakh crore in value, dropping to ₹439 lakh crore in total market capitalization.

Market Overview: A Sudden Plunge

The Indian stock market experienced significant losses, with both major indices—Sensex and Nifty—facing intense selling pressure. Early trading saw the Sensex open flat at 79,281.65 points, slightly up from its previous close of 79,223.11 points. However, volatility soon set in as the market fluctuated between gains and losses.

The trigger for the downturn was news of HMPV cases being detected in Bengaluru and Gujarat. This new virus scare created panic among investors, leading to a rapid decline in market sentiment. By midday, the Sensex had dipped by 1,400 points, reaching an intraday low of 77,781.62 points. It closed the day at 77,964.99, down by 1,258.12 points. Similarly, the Nifty lost 388.70 points, settling at 23,616.05.

The ₹12 Lakh Crore Loss

The market’s sharp slide resulted in a massive erosion of investor wealth. The total market capitalization of all companies listed on the Bombay Stock Exchange (BSE) dropped by a staggering ₹12 lakh crore. The market capitalization now stands at ₹439 lakh crore, down from ₹451 lakh crore earlier.

Impact on the Rupee and Key Stocks

As the stock market fell, the Indian rupee also weakened. The currency depreciated by 3 paise, trading at ₹85.82 against the US dollar. Among individual stocks, Tata Steel, NTPC, Kotak Mahindra Bank, IndusInd Bank, and Power Grid Corporation were the biggest losers in the Sensex 30 index. The only stocks that managed to stay in the green were Titan and Sun Pharma.

Internationally, Brent crude oil was trading at $76.30 per barrel, while gold was priced at $2,645 per ounce, indicating a global risk-off sentiment as investors fled to safer assets.

Contributing Factors Behind the Market Decline

The resurgence of the HMPV virus in China has added to fears, particularly after cases were reported in Bengaluru and Gujarat. The news sparked concerns that the virus could spread further, derailing India's economic recovery. Analysts believe that this uncertainty caused a ripple effect, affecting market sentiment.

Additionally, weak signals from Asian markets compounded the situation. With the U.S. set to swear in President Trump in the coming days, fears of increased tariffs on China and other trading partners have further dampened investor confidence. Stock markets in Japan, Hong Kong, and Shanghai ended in losses, dragging down sentiments in India as well.

The selling pressure was particularly high in large-cap stocks like HDFC Bank, Reliance, ITC, and Tata Steel, which have a significant weight in the indices. This continued selling from foreign institutional investors (FII) has been another key reason for the downturn in the domestic equity markets.

Conclusion

Today’s market crash highlights the sensitivity of the stock market to global and domestic developments. While the fears of a new virus strain have caused immediate turbulence, the ongoing pressure from foreign investors and the uncertain global economic landscape have also played a role in the market's decline. Investors will be closely watching for any signs of recovery in the coming days as they navigate these challenging market conditions.