Sensex suffers worst fall in 10 months: Factors responsible, sectors affected

Indian stock
markets recorded the worst single-day fall in nearly 10 months amid a global selloff
on Friday as the BSE Sensex crashed 1,940 points while NSE Nifty tanked
over 568 points to go below the 1,5000 mark, reports PTI.

Also Read: India’s GDP grows by 0.4% in October to December quarter of FY2020-21

While experts believe it to be a shock triggered by tensions arising in bond
markets overseas, some feel the rising geo-political frictions between US and Syria the key reason.

Here’s an analysis of what actually led to the market downfall.

Rise in bond yields

The surge in bond yields, both at global and domestic level weakened the Indian market to a great extent as it raised concerns for the investors who in turn act as an agent for fall in equity markets. Thus, when bond yields go up, investors start relocating their investment to bonds from equities as they are much safer

Also Read: 7 ways to get a loan quickly during a financial emergency

US-Syria geopolitical tensions

According to Vinod Nair, Head of Research at Geojit Financial Services, the escalating geopolitical tensions between the US and Syria compounded the selling due to growing uncertainties of investors regarding global market. Apart from this, GDP data for quarter  is also on course to add volatility in the Indian Markets.

Which are the worst affected sectors?

1-Banking sector suffered the maximum loss with over a 4.8% drop.

2- Financial
and Telecom indices are next worst impacted after a sharp fall of 4.9% and 3.8% respectively.