Sensex crashes over 800 points!

The Indian stock market saw sharp declines on Monday, December 8, with benchmark indices slipping nearly 1% and mid- and small-cap stocks suffering steeper losses of about 2%. The Sensex fell over 800 points to 84,875, while the Nifty 50 dropped to 25,892. Market wealth eroded sharply as the total valuation of BSE-listed companies slid to ₹464 lakh crore from ₹471 lakh crore, wiping out over ₹7 lakh crore in a single session.

Experts say the medium-term outlook remains constructive, but five key factors drove Monday’s sell-off. The rupee’s slide to around 90.15 per dollar amid rising crude prices and persistent foreign outflows weighed heavily on sentiment. Uncertainty ahead of the US Federal Reserve’s December 10 rate decision also prompted investors to cut exposure.

Lingering ambiguity over the India-US trade deal added to caution, despite recent positive signals. A surge in Japanese bond yields raised concerns about a reversal of the yen carry trade, posing risks to emerging markets. Meanwhile, FIIs continued their aggressive selling, offloading over ₹1.6 lakh crore since July and more than ₹10,000 crore in just five sessions this month. Volatility may persist until earnings improve and the trade deal progresses.