CHENNAI: Indian equity markets closed sharply lower on Thursday, June 12, as investor sentiment took a hit from weak global cues, rising crude oil prices, and pre-inflation data jitters. Both benchmark indices tumbled, snapping recent gains and signalling heightened market volatility ahead of key economic data releases.
BSE Sensex dropped 823.16 points or 1% to close at 81,691.98, and NSE Nifty 50 plunged 253.20 points or 1.01% to settle at 24,888.20.
Broader market indices also mirrored the weakness, with the Nifty Midcap and Smallcap indices posting moderate declines.
Crude Oil & Currency Impact
The Indian rupee closed weaker at 85.60 against the US dollar, down 7 paise from its previous close. The decline came amid renewed dollar buying by oil companies after Brent crude climbed past $70 per barrel, raising concerns over import costs and inflation.
According to analysts the rupee fell today as oil companies bought the dollar following the rise in oil prices.
The Dollar Index fell 0.43% to 99.20, offering some cushion to emerging market currencies, including the rupee.
Global Uncertainty
Risk-off sentiment in global markets amid geopolitical tensions and cautious stance ahead of US inflation data.
A sharp rebound in global crude prices renewed inflation concerns and weighed on oil-importing economies like India.
Additionally, investors await India’s CPI data and the US PPI report, both scheduled for Friday, for further policy cues.
The analysts warn that market participants are likely to stay cautious heading into Friday’s trading session, with inflation readings and global economic signals in focus. The rupee is expected to remain in a narrow range of 85.35 to 85.95, according to forex analysts.
Thursday's market slide reflects broader investor anxiety around global inflation and commodity price movements. The combination of falling equities and a softening rupee highlights the fragile risk sentiment in the current environment.