Stock Markets Slide For Fourth Day As Foreign Selling, High US Yields And $100 Crude Hit Sentiment

Indian stock markets extended their losing streak to a fourth straight session on Thursday as heavy foreign fund selling, rising US bond yields and a fresh jump in crude oil prices combined to weigh on investor sentiment.

The Sensex fell 570.59 points, or 0.79 per cent, to 71,909.70, while the Nifty declined 198.50 points, or 0.88 per cent, to 22,421.95. The selling pressure was much sharper during the day, with the Sensex plunging 1,187 points to an intraday low of 71,292.88 before recovering some ground.

The latest fall came against the backdrop of another large withdrawal by foreign investors. Foreign Institutional Investors sold equities worth Rs 10,148.41 crore on Wednesday, according to exchange data. Continued overseas selling has emerged as a major pressure point for Indian equities as global investors reassess the relative attractiveness of emerging markets.

The rise in US Treasury yields added to the pressure. The US 10-year Treasury yield moved towards 5.34 per cent, strengthening the appeal of dollar-denominated assets and making Indian equities relatively less attractive for foreign investors.

At the same time, crude oil prices crossed an important threshold. Brent crude jumped 2.77 per cent to USD 100.8 a barrel, raising concerns for an oil-importing economy such as India. Persistently expensive crude can put pressure on import costs and inflation while also affecting corporate margins and the broader economic outlook.

"External factors" were largely behind the sell-off, with bond yields at multi-year highs and crude prices remaining elevated, Geojit Investments Head of Research Vinod Nair said.

Hariselvan Radhakrishnan, Founder and CEO of HST Wealth, said the combination of elevated US Treasury yields and foreign selling could keep pressure on Indian equities.

Among Sensex stocks, Maruti Suzuki, Mahindra & Mahindra, Tata Steel, Adani Ports, ITC, Power Grid, Hindustan Unilever and Eternal were major losers. Infosys, TCS, HCL Technologies and HDFC Bank were among the gainers.

The decline came despite gains in key Asian markets, including South Korea's KOSPI and Japan's Nikkei 225. European markets were trading lower, while US markets had ended mostly lower on Wednesday.