Mumbai Increasing 10-year bond yields in the US has created a furore in the markets around the world. It also had a clear impact on the Indian markets on Friday. The result was a sharp decline in Indian markets. On Friday, the Sensex closed down 1,939 points, or 3.80 per cent, at 49,099.99. This is the biggest decline in the year 2021 in the market. The last time such a big fall was seen on one day was on May 4, 2020, when the index slipped more than two thousand points. The Sensex fell 2148.83 points to the lowest level of the day and touched 48,890.48 amid heavy downpour. On February 25, the BSE Sensex closed at 51,039.31, a gain of 257 points.
Two lakh crores of investors drowned –
Six lakh crore rupees of investors were drowned in this huge market fall on Friday. The market capitalization of listed companies declined to Rs 2,00,64,472.99 crore. Investors have incurred a loss of Rs 1,450 crore every minute.
Bond Yield Market Connection
Bond yields and equity returns are inversely proportional. Equity markets tend to decline when bond yields rise. Bond yields are rising in the US due to concerns over inflation. This is not good news for Indian markets.
Decline in global stock markets –
The Nasdaq index was down 13,119 and the Dow Jones closed down 559 points. Japan’s Nikkei index was down 737 points. Hong Kong’s Hangseng index was down 771 points. The Shanghai index, Korea’s Cospi and Australia index are below.
The impact of the fall in the Nifty too –
Investors sold the most in banking and auto sector stocks. That is why the Nifty Bank index is down 4.78 percent at 34,803.60 and the Auto index is down 3.12 percent at 10,169.90. The Nifty also closed down 568 points, or 3.76 percent, at 14,529.15. It closed 115 points higher at 15,097.35 on Thursday.
The top losers include ONGC, M&M, Power Grid, JSW Steel and Hero MotoCorp.
Impact on these sectors-
Finance services, FMCG, IT, PSU banks, banks, pharma, private banks, metal, auto, media and realty sectors were affected.