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Stock Market Crash: Sensex Plummets 2,686 Points, Investors Lose Rs 17.11 Lakh Crore in Market Mayhem

By Jhanak Sharma      05 August, 2024 04:07 PM      0 Comments
Stock Market Crash Sensex Plummets 2686 Points Investors Lose in Market Mayhem

New Delhi: The stock market experienced a significant decline on Monday, eroding investors' wealth by Rs 17.11 lakh crore to Rs 4,40,04,979.86 crore during the afternoon trade. Following a substantial drop in its Asian counterparts, the Indian stock market continued to struggle with the BSE Sensex plummeting 2,686.09 points, or 3.31%, to 78,295.86. Meanwhile, the NSE Nifty sank 824 points, or 3.33%, to 23,893.70.

Five Key Factors Behind the Market Decline

Siddarth Bhamre, Head of Research at Asit C Mehta Investment Intermediates Ltd, explained the primary factors contributing to the market's decline:

1. Worsening US Job Data: US non-farm payrolls fell short of market expectations, and the unemployment rate rose to 4.3% compared to the anticipated 4.1%. This increase in unemployment could diminish the likelihood of a soft landing, which the FED is attempting to achieve by maintaining higher interest rates to control inflation.

2. Decreasing Corporate Profitability in the US: Several large US companies, both in technology and consumer sectors, have seen significant corrections as their earnings have disappointed investors.

Also Read: Worst market crash in 4 years: Investors lose nearly Rs. 31 lakh crore after election results

3. Global Equities and Geopolitics: Corrections in global markets, particularly led by the US, coupled with geopolitical tensions between Iran and Israel, have further exacerbated the market decline.

4. Rich Valuation of Indian Equities: Indian markets have absorbed multiple negative news factors yet continued to climb due to strong liquidity. Currently, there is insufficient valuation support.

5. High Weightage of Banks and IT Companies: Banks and IT companies constitute over 50% of the Nifty or Sensex weightage. External factors significantly impacting these sectors have led to a more pronounced correction.

Source: Zee News
 



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