The Indian stock market experienced notable volatility on Monday, October 7, with the benchmark Sensex plunging over 1,400 points from its intraday high amid a broad-based selloff. The Sensex opened at 81,926.99 against its previous close of 81,688.45 and rose nearly 450 points to 82,137.77. The index, however, erased all gains and tanked 1,412 points from the intraday high level to touch the level of 80,726.06 on the downside. Around 2 pm, the index traded 655 points lower at 81,027.70.
The Nifty 50 opened at 25,084.10 against its previous close of 25,014.60 and touched its intraday high and low of 25,143 and 24,694.35, respectively. The volatility index India VIX jumped over 6 per cent during the session. The Sensex and Nifty 50 have remained red for six consecutive sessions, shedding nearly 5 per cent. The market's decline has been largely driven by significant selloffs from foreign portfolio investors (FPIs). Apart from the FPI selling, geopolitical tensions and exit poll results of the Haryana and J&K elections have also contributed to the market's poor show.
According to NSDL data, FPIs offloaded Indian equities worth ₹27,142 crore in just the first three days of October. Much of this capital is being directed to China, following the country's recent measures to support its economy and financial markets. The shift is driven by the attractive valuations in the Chinese market compared to the premium valuations in the Indian market. Chinese markets have seen perplexing gains in the last few sessions. Over the last week, the Shanghai Composite Index has jumped 21 per cent, and the Hang Seng index has surged over 15 per cent. In the last 6 trading sessions since September 27, Sensex has fallen 5,252 points as the combined market capitalisation of BSE-listed stocks has fallen by Rs 27.04 lakh crore to Rs 452.06 lakh crore, as of 1:45 PM. In the week gone by, Sensex and Nifty recorded their worst week since June 2022 as they ended the week with a loss of 4.3 per cent and 4.5 per cent, respectively.