- By Soumyaroop Mukherjee
- Mon, 08 Dec 2025 03:26 PM (IST)
- Source:JND
The Indian stock market experienced a dramatic, late-day decline today. Benchmark indices sharply plummeted, leading to investors losing over Rs 7 lakh crore in wealth.
The 30-share S&P BSE Sensex fell by more than 800 points while the Nifty 50 breached the psychological mark of 26,000 points, sending traders into a frenzy. The severity of the slump was amplified in the broader market, where the BSE Midcap and Smallcap indices fell by over 2% each.
To be sure, the correction was not triggered by a single event but rather a confluence of global cautiousness and persistent domestic headwinds that forced traders and foreign investors to rush for the exit.
Reasons For Today's Late Stock Sell-Off:
- The main cue was the extreme caution of the traders ahead of the US Federal Reserve’s interest rate decision, the FOMC meeting. The threatening stance of the Fed led an aggressive de-risking by the traders. Meanwhile, a stronger US dollar resulting from the US Fed policy puts immense pressure on emerging markets.
- The rupee has hit an all-time low in the international market against the US dollar (around Rs 90.38). The severe currency depreciation directly affects the returns for Foreign Institutional Investors, compelling them to sell their equity holdings, thereby creating a nosedive in the Sensex. This selling pressure created a negative feedback loop, causing a rapid Sensex fall.
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- Increased global crude oil prices heighten India's import bill and fuel inflationary pressures. Moreover, the lingering uncertainty surrounding the India-US trade deal dampened investor sentiment, particularly in trade-sensitive sectors.
- The sell-off was felt in the broader market as the Midcap and Smallcap indices came crashing down by over 2 per cent, thereby suggesting a profit-booking where investors sold smaller stocks rather than holding them.