5 reasons why market is down today: Sensex, Nifty hit six-month lows; India VIX spikes

Key equity benchmarks Nifty and Sensex hit their lowest levels in six months, falling in line with other Asian markets, thanks to a rising dollar, soaring crude oil prices, hardening bond yields, persistent foreign outflows and fears of rate hikes ahead. 
  
At 10.30 am, the BSE Sensex was trading 629 points, or 0.86 per cent, lower at 72,151. It hit a low of 72,064 so far. The NSE Nifty tested 22,600 and hit a low of 22,569.65. The 50-pack index was later trading 194 points or 0.85 per cent lower at 22,582.40.

Against 1,225 actively traded stocks that rose, 2,655 shares were quoting in the red on BSE. Within 90 minutes of trading, a total of 190 BSE-listed stocks had hit their 52-week lows, with listed stocks together losing Rs 4.38 lakh crore in market value today.

Fear gauge India VIX spiked 5.53 per cent to 14.39.

"With Brent crude above $107 and the US 10-year at 5.25 per cent, the global macro construct continues to be unfavourable for equity markets. The emerging macro scenario in the US appears to be one of high growth and high inflation," said V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.

A total of 27 of 30 Sensex stocks fell, with HCL Tech, Bajaj Finance, Titan Company Ltd, Infosys and Maruti Suzuki India Ltd dropping up to 2 per cent.

Five reasons why maket is down today:

Oil prices 
The US President Donald Trump rejecting any peace deal with Iran brought risk premium back, sending crude oil prices soaring for the second straight day. Brent crude for November delivery climbed 1.89 per cent to $107.27 a barrel level. It stood below $100 a barrel; level on September 22.

Dollar sends Asia lower
Dollar index, which tracks the movement of greenback against six major global currencies, rose further to 101.28 per cent in Tuesday's session. The index has inverse relationship with emerging market (EM) assets, meaning a rising dollar typically dragged EM stocks. Japan's Nikkei fell 1.37 per cent, Korea's Kospi fell 0.96 per cent, Taiwan's Taiex also dropped 0.77 per cent. India was no exception.

FPI selloff intensifies
Provisional data suggests FPIs sold Rs 5,353.22 crore worth equities in the cash market on Monday. With the rupee depreciating against the dollar, there are fears FPI may continue pulling money out of Indian stocks. They have sold shares worth Rs 20,695 crore in September so far after buying Rs 29,631 crore worth equities in August and Rs 20,200 crore in July, with cumulative outflows for 2026 standing at Rs  2,45,136 crore.

Hardening bond yields
Rising bond yields generally have an inverse relationship with stock prices, as higher risk-free returns make fixed-income assets more attractive. India's 10-yera bond yields stood at 7.16 per cent today. In the US, 10-year bond yield stood at 5.25 per cent.

Hemang Gor, Senior Research Analyst - Derivatives and Technical Research at  Axis Direct said  rising global bond yields are coinciding with September quarter-end FII rebalancing, a period that historically amplifies Indian equity volatility.

Rate hike bets
Central Bankers across the world are losing patience over inflation. The US FOMC minutes indicated that there was concern over inflation beyond the dissents. This sentiment was echoed by Chair Warsh in an unexpectedly hawkish Jackson Hole speech.

"The rate path has firmed up across the Pacific too, with a sudden influx of foreign capital, semiconductor demand, and a tottering JPY spiking inflation and increasing the clamour for a BoJ rate hike. Clearly, the present mix of economic conditions is unstable and something will have to give," SBI Securities said.

Nomura said the RBI's monetary policy is at an inflection point. Markets are pricing close to 125 basis points of rate hikes over the next one year, it said.