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.
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
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.