Stock Market Crash: In the domestic stock market, a fall of about 1500 points has been seen in Sensex today. From the previous closing level on November 1 i.e. the day of Diwali Muhurat trading, Sensex has lost 1491.52 points from today’s level. Due to the terrible fall, today the domestic market has lost Rs 8.44 lakh crore of investors. Today’s lowest level of Sensex is 78,232.60 and due to the outcry, there was a fear that it might break the level of 78 thousand today itself.
Sensex status at 1.25 pm
At 1:30 pm, Sensex is trading at 78,386 levels with a decline of 1338 points or 1.68 percent. BSE Sensex has reached Rs 440.69 lakh crore. Out of 4124 shares currently being traded on BSE, 2833 shares are trading with a red mark of decline. By this time Nifty also fell by 414 points to 23,890. It had reached today’s lowest level of 23,816, which means that it has returned after losing 488.20 points.
5 big reasons for the market decline which sank the stock market
US presidential election results
1. Due to the presidential elections in America, a slight decline of 93 points is being seen in the main indexes of American markets, Dow Jones and Dow Jones Futures. Dow Futures currently remains at the level of 41,959 and due to its fall, weakness and pressure is being seen in the Indian market as well. At the same time, due to the presidential elections in America, there is a strong possibility of instability in the markets there and due to this, there is a possibility of sluggish trade in the domestic market as well. Whoever becomes the President of America, the coming times will remain turbulent for India due to its impact.
2. Indian market valuations still high
The valuations of the Indian market are still high and under this the current PE (price-to-earnings) ratio of Nifty 50 is at 22.7. This is higher than its two-year average PE of 22.2 and very close to the one-year average of 22.7. Many shares in the Indian market are running higher than their valuation and on the basis of these, foreign or domestic investors are looking for the right opportunity to invest money in the market. These valuations have increased to such an extent that even after today’s fall, they are not able to encourage investors to buy.
3. Continuous selling by FPI-FII
There is an atmosphere of concern in the Indian market due to continuous selling by Foreign Portfolio Investors (FPIs). There is also tremendous selling by foreign institutional investors (FIIs). Due to these foreign investors withdrawing money from the Indian market, the outflow of funds has continued rapidly even during the festive season.
4. Weak quarterly results
Due to the weak results of Indian companies for the July-September quarter, the sentiment in the domestic stock market is also being affected. Most of India Inc’s September quarter results have been below market expectations. Due to this effect, the outlook of investors regarding the market has been disturbed. Nifty EPS (earnings per share) may fall below 10 percent in the financial year 2025. This is having a negative impact on the entire earnings outlook for financial year 2025 due to which there is concern among foreign and domestic investors.
5. US Federal Reserve’s decision on interest rates
The next meeting of the US Federal Reserve is scheduled to be held on November 7 and experts are already expecting a rate cut of 0.25 percent or 25 basis points. However, this move is not going to cause much concern for the market because this factor has already been factored into the market. However, due to the huge spending in the US elections, there will be huge spending in the US and due to this the fiscal deficit there will remain high and bond yields will remain high – which is not a good fact for global markets.
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