Trump threat shakes markets, ₹8 lakh crore wiped out in seconds

New Delhi (The Uttam Hindu): Rising tensions in the Middle East and fears of a prolonged conflict involving Iran, the United States, and Israel triggered a sharp fall in global stock markets on Monday. After a brief recovery attempt a day earlier, markets came under pressure again, with heavy selling seen across equity markets worldwide, including India.

Continuous selling by foreign investors and a sharp rise in crude oil prices further heightened investor concerns. As a result, both key domestic indices—BSE Sensex and Nifty 50—recorded significant declines, while midcap and smallcap stocks also faced strong selling pressure.

During trading, the Sensex dropped 1,387.55 points (1.86%) to 73,145.41, while the Nifty fell 423.35 points (1.83%) to 22,691.15. In early trade, the Sensex slipped to 72,977.34 and the Nifty to 22,634.55.

Massive erosion in investor wealth

Due to the sharp decline, the total market capitalization of companies listed on BSE fell by about ₹8.15 lakh crore. From ₹4.29 lakh crore on March 20, it dropped to ₹4.20 lakh crore as markets opened on March 23.

What caused the market crash?

The biggest trigger behind the fall is escalating Middle East tensions and US President Donald Trump’s 48-hour ultimatum to Iran. Trump warned Iran to reopen the Strait of Hormuz or face destruction of its energy facilities. This raised fears over global supply chains, pushing crude oil prices close to $100 for WTI and above $112.17 for Brent crude.

Aggressive FII selling

Foreign Institutional Investors (FII) added further pressure, with net selling of around ₹1 lakh crore over the past 16 trading sessions, significantly weakening market sentiment.

All Sensex stocks in red

All 30 Sensex stocks traded in the red. Shares of Tata Steel, Mahindra & Mahindra, and HDFC Bank were among the worst hit.

Experts believe that volatility may continue until tensions in the Middle East ease and crude oil prices stabilize.