Closing Bell: Sensex Crashes 1,456 Points, Nifty 50 Falls 1.83%; Rs 10.11 Lakh Crore Investor Wealth Wiped Out

Market Update at 04:07 PM: Indian equity benchmark indices extended their losing streak for the fourth consecutive session on Tuesday, May 12, as elevated crude oil prices and uncertainty surrounding negotiations to end the Iran war weighed heavily on investor sentiment. Weak global cues, sharp declines in IT stocks, and continued foreign fund outflows further pressured the domestic markets.

The benchmark Nifty 50 opened 90 points lower and slipped further to hit an Intraday low of 23,348.40. The index eventually settled at 23,379.55, down 436.30 points or 1.83 per cent. The BSE Sensex also witnessed a sharp selloff, plunging 1,456.04 points or 1.92 per cent to close at 74,559.24.

The Bank Nifty index also remained under pressure and declined more than 1.63 per cent to settle slightly above the 53,550 mark. Meanwhile, volatility surged in the market as the India VIX index jumped 3.92 per cent above the 19 level, indicating rising fear among investors.

The sharp decline in equities led to a massive erosion in investor wealth. India’s total market capitalisation dropped from Rs 4,66,58,569.68 crore on May 11 to Rs 4,56,47,282.79 crore on May 12. This resulted in a loss of nearly Rs 10,11,286.89 crore in a single trading session.

The Nifty IT index emerged among the worst-performing sectoral indices, falling 3.73 per cent to its lowest level since May 2023. The decline came after OpenAI announced a new AI venture, reviving fears regarding AI-led disruption in the Indian information technology sector.

Heavyweight IT stocks witnessed significant selling pressure. Tata Consultancy Services, Infosys, HCL Technologies, and Wipro declined between 2.5 per cent and 5 per cent as investors assessed the long-term implications of artificial intelligence on India’s USD 315 billion IT industry.

Global crude oil prices continued to rise amid fading hopes of a breakthrough in negotiations aimed at ending the U.S.-Israeli conflict involving Iran. Concerns regarding potential supply disruptions pushed energy prices higher.

Brent crude futures rose USD 2, or 1.9 per cent, to USD 106.21 per barrel, while U.S. West Texas Intermediate crude gained USD 2.31, or 2.4 per cent, to USD 100.38 per barrel. Both benchmarks had climbed nearly 2.8 per cent during the session.

The Indian rupee weakened further and declined 0.46 per cent to 95.74 against the U.S. dollar, marking a record low. The domestic currency remained under pressure due to rising crude oil prices, persistent foreign portfolio outflows, and weakening market sentiment.

Sectorally, all 11 major sectoral indices ended the session in the red. Broader markets also witnessed sharp selling pressure, with the Nifty Midcap index falling 2.54 per cent and the Nifty Smallcap 100 index declining 3.15 per cent.

The Nifty Realty index emerged as the top sectoral loser, dropping 4.11 per cent and extending losses for the third straight trading session. All constituents of the index ended lower during the day.

Despite the broader market weakness, shares of ONGC and Oil India remained in focus and ended higher after the government announced royalty cuts on crude oil and gas production.

ONGC gained 4.80 per cent, while Oil India surged 7.66 per cent, as the move was seen as a significant positive for both companies.

Among the stocks supporting the Nifty 50 index, Oil and Natural Gas Corporation contributed 11.36 points, followed by Hindalco Industries with 5.63 points and State Bank of India with 0.90 points.

On the other hand, HDFC Bank emerged as the biggest drag on the index, pulling it down by 43.92 points. ICICI Bank contributed a negative impact of 40.64 points, while Reliance Industries weighed on the index by 35.51 points.

Market breadth on the NSE remained firmly negative on May 12, indicating broad-based selling across sectors.

Out of 3,381 stocks traded on the NSE, 590 advanced, while 2,726 declined and 65 remained unchanged.

A total of 69 stocks touched their 52-week highs, whereas 45 stocks hit their 52-week lows. Additionally, 69 stocks were locked in Upper Circuits, while 172 stocks hit Lower Circuits during the session.

Market Update at 2:29 PM: Indian equity benchmark indices extended their losses on Tuesday as investors closely tracked developments in West Asia after fresh comments from U.S. President Donald Trump raised concerns over the fragile ceasefire between Iran and Israel.

The NIFTY slipped 359.55 points, or 1.51 per cent, to trade at 23,449.90, while the SENSEX declined 1,241.48 points, or 1.63 per cent, to 74,783.48.

Broader markets also remained under pressure amid weak sentiment. The Nifty MidCap index was down 1.50 per cent, while the Nifty SmallCap index declined 2.07 per cent during the session.

Among sectoral indices, the Nifty IT index emerged as the worst performer, witnessing sharp selling pressure. The Nifty Realty and Nifty Media indices also underperformed the broader market. However, the Nifty Metal and Nifty Oil and Gas indices showed relative resilience and outperformed amid rising crude oil prices.

Market sentiment weakened after Trump stated that the month-old ceasefire with Iran was on “massive life support” following what he described as an “unacceptable” proposal from Tehran. According to media reports, the ceasefire continued to remain fragile, adding to concerns over geopolitical stability in the region.

Meanwhile, crude oil prices surged further as fears of prolonged supply disruption through the Strait of Hormuz intensified. Brent crude’s May futures contract climbed 2.53 per cent to USD 106.85 per barrel on the Intercontinental Exchange.

The spike in crude prices added pressure on domestic equities, as higher oil prices could impact India’s inflation trajectory, fiscal balance, and import bill.

Market Update at 12:36 PM: Indian equity benchmark indices extended their losses on Tuesday as investors closely monitored the geopolitical situation in West Asia following comments by U.S. President Donald Trump regarding the fragile ceasefire with Iran.

The Nifty 50 declined 221.15 points, or 0.93 per cent, to trade at 23,592.80. Meanwhile, the Sensex slipped 806.17 points, or 1.06 per cent, to 75,207.23 during the session.

Broader markets also remained under pressure. The Nifty MidCap index traded 1.24 per cent lower, while the Nifty SmallCap index fell 1.60 per cent, reflecting weakness across the wider market.

Among sectoral indices, the Nifty IT index emerged as the worst performer. The Nifty Realty and Nifty Media indices also witnessed significant selling pressure. On the other hand, the Nifty Metal and Nifty Oil and Gas indices outperformed the broader market, supported by rising crude oil prices.

Investor sentiment remained cautious after Donald Trump stated that the month-old ceasefire with Iran was on “massive life support” following what he described as an “unacceptable” proposal from Iran. According to media reports, the ceasefire situation continues to remain fragile.

Global crude oil prices moved higher amid concerns over prolonged supply disruptions through the Strait of Hormuz. Brent crude May futures rose 0.76 per cent to trade near USD 105 per barrel on the Intercontinental Exchange.

Precious metals also traded with a positive bias. Gold futures edged up 0.06 per cent, while silver futures gained 1.18 per cent amid rising geopolitical uncertainty and safe-haven demand.

Market Update at 09:33 AM: Indian equity benchmark indices extended their losses on Tuesday as investors closely tracked developments in West Asia after U.S. President Donald Trump made fresh remarks on Iran and the fragile ceasefire situation.

The Nifty 50 declined 106.60 points, or 0.45 per cent, to trade at 23,716.25, while the Sensex slipped 400.35 points, or 0.53 per cent, to 75,614.93 during the session.

Broader markets also traded on a weak note, although losses remained limited. The Nifty MidCap index was down 0.01 per cent, while the Nifty SmallCap index slipped 0.02 per cent.

Investor sentiment remained cautious after Trump stated that the month-old ceasefire with Iran was on “massive life support” following what he described as an “unacceptable” proposal submitted by Iran. According to reports, the ceasefire situation continues to remain fragile, raising concerns over further geopolitical tensions in the region.

Meanwhile, oil prices moved higher amid fears of prolonged supply disruptions through the Strait of Hormuz, a critical global oil transit route. Brent crude’s May futures contract gained 0.75 per cent to trade at USD 104.99 per barrel on the Intercontinental Exchange.

The rise in crude oil prices added pressure on domestic equities, as higher energy costs could impact India’s inflation outlook and increase import-related expenses. Market participants are expected to remain focused on further developments in West Asia and movements in global crude prices for near-term direction.

Pre-Market Update at 7:40 AM: Indian stock market benchmark indices, the BSE Sensex and Nifty 50, are likely to open lower on Tuesday, May 12, amid rising concerns over the ongoing U.S.-Iran conflict and its potential impact on India’s economy and inflation outlook.

Gift Nifty hovered around the 23,653 mark, trading at a discount of nearly 182 points to the previous close of Nifty futures, indicating a weak start for domestic equities. While Asian markets traded higher, Wall Street ended with modest gains overnight, supported by continued optimism around artificial intelligence (AI)-driven technology stocks.

Geopolitical tensions remained elevated after U.S. President Donald Trump said the ceasefire between the U.S. and Iran was on “massive life support” and at its weakest point after rejecting Tehran’s latest proposal to end the conflict. At the same time, Iranian Parliament Speaker Mohammad-Bagher Ghalibaf stated that there was no alternative but to accept the proposed 14-point framework aimed at easing tensions.

Prime Minister Narendra Modi renewed his appeal for austerity measures as disruptions linked to the U.S.-Iran conflict continue to impact global markets. He urged citizens to support economic restraint efforts and suggested schools consider temporary online classes wherever feasible.

Japan’s 10-year government bond yield climbed to a 29-year high ahead of a debt auction. The 10-year Japanese Government Bond (JGB) yield rose 2 basis points to 2.540 per cent, its highest level since June 1997. Meanwhile, the 30-year yield edged up to 3.78 per cent, while the 40-year yield advanced to 4.035 per cent, reflecting continued pressure in global bond markets.

India currently has around 60 days of crude oil and natural gas reserves, the central government said during the 5th Informal Group of Ministers meeting chaired by Defence Minister Rajnath Singh to review the country’s energy supply situation amid the Middle East conflict.

Crude oil prices continued to rise as fragile negotiations between the U.S. and Iran kept supply concerns elevated. Brent crude futures gained 0.29 per cent to USD 104.51 per barrel, while U.S. West Texas Intermediate (WTI) crude rose 0.32 per cent to USD 98.38 per barrel after both benchmarks rallied nearly 2.8 per cent in the previous session.

The U.S. dollar remained steady as talks to end the Middle East conflict showed little progress. The dollar index stood at 97.98.

From a derivatives perspective, the Put-Call Ratio (PCR) stands at 0.56. On the Put (PE) side, significant open interest among the nearest strikes is concentrated at 23,000 followed by 23,500, suggesting these levels are likely to act as immediate support zones for the Nifty 50. On the Call (CE) side, major open interest addition during the previous trading session was seen at the 24,000 strike, indicating strong resistance at that level. In the near out-of-the-money strikes, high open interest is also concentrated at 24,500.

The Nifty 50 is currently hovering near a crucial support zone of 23,780–23,800, which is expected to act as a key make-or-break range in the near term. A decisive breakdown below this zone could trigger further weakness towards 23,689, which coincides with the 38.2 per cent Fibonacci retracement level. The next major support is placed near 23,405, aligning with the 50 per cent Fibonacci retracement and a previous gap area. On the upside, the index faces immediate resistance at its 50-day moving average (DMA) placed at 23,959. A sustained move above this level could pave the way for a recovery towards the 20-DMA near 24,156.

Several companies are scheduled to announce their quarterly earnings on May 12, including Dr. Reddy's Laboratories, Tata Power Company, Berger Paints India, Dixon Technologies (India), INOX India, Max Financial Services, One Mobikwik Systems, Nazara Technologies, Pfizer, Torrent Power, and V-Guard Industries among others.

For Tuesday’s session, Steel Authority of India Limited (SAIL) remains under the F&O ban list.

Foreign Institutional Investors (FIIs) remained net sellers on May 12, offloading equities worth Rs 8,437.56 crore. Domestic Institutional Investors (DIIs), however, purchased shares worth Rs 5,939.65 crore during the session.

On Monday, Indian benchmark indices ended sharply lower for the third consecutive session amid broad-based selling pressure. The Sensex plunged 1,312.91 points, or 1.70 per cent, to close at 76,015.28, while the Nifty 50 declined 360.30 points, or 1.49 per cent, to settle at 23,815.85.

U.S. markets ended marginally higher on Monday, supported by continued optimism surrounding AI-related technology stocks. The Dow Jones Industrial Average gained 95.31 points, or 0.19 per cent, to close at 49,704.47. The S&P 500 rose 13.91 points, or 0.19 per cent, to 7,412.84, while the Nasdaq Composite advanced 27.05 points, or 0.10 per cent, to settle at 26,274.13.

Among major technology stocks, NVIDIA climbed 1.96 per cent, Advanced Micro Devices rose 0.79 per cent, Intel jumped 3.64 per cent, and Qualcomm surged 8.4 per cent. Meanwhile, Tesla rallied 3.91 per cent, while Apple slipped 0.20 per cent, Microsoft fell 0.58 per cent, and Amazon declined 1.35 per cent.

Gold prices moved higher as investors closely monitored developments related to the U.S.-Iran conflict in the Middle East. Spot gold prices rose 0.5 per cent to USD 4,757.59 per ounce, while spot silver prices gained 0.2 per cent to USD 86.27 per ounce.

Disclaimer: The article is for informational purposes only and not investment advice.

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