Stock market crash today: Nifty50 ends below 24,900; BSE Sensex sinks over 800 points - top 5 reasons stock market fell

Stock market crash today: Nifty50 and BSE Sensex, the Indian equity benchmark indices, tanked in trade on Thursday. While Nifty50 went below 24,900, BSE Sensex tanked over 900 points intraday. Nifty50 ended the day at 24,888.20, down 253 points or 1.01%. BSE Sensex closed at 81,691.98, down 823 points or 1%.Investors responded to various global uncertainties, including heightened Middle East tensions and caution before the weekly F&O expiry. IT stocks led the downturn, causing benchmark indices to drop nearly 1% during intraday trading.The BSE-listed companies' total market capitalisation reduced by Rs 4.19 lakh crore to Rs 451 lakh crore, indicating widespread selling across sectors.1) Escalating Middle East tensionsInvestors adopted a cautious approach following several developments indicating worsening security conditions in the Middle East.US President Donald Trump stated on Wednesday "it could be a dangerous place," whilst announcing the relocation of US personnel from the Middle East, and emphasised that Iran would not be permitted to possess nuclear weapons.According to Reuters, American and Iraqi officials revealed that the US is initiating a partial evacuation of its Iraq embassy and authorising military dependents to depart from various regional locations due to increased threats.The situation is particularly crucial as US intelligence suggests Israel's preparation for a possible attack on Iranian nuclear facilities. Simultaneously, Iranian Defence Minister Aziz Nasirzadeh issued a warning that "if Iran was subjected to strikes it would retaliate by hitting US bases in the region."Regional markets reflected these tensions. The Saudi Arabian benchmark index declined by 1.3%, affected by major companies including Al Rajhi Bank dropping 0.6% and Saudi Aramco falling 0.4%. Dubai's main share index experienced its largest intraday decline since April, dropping 1.7%, with Emaar Properties declining by 3%.2) Fresh Trade Policy ConcernsNew anxieties emerged in unsettled markets as US President Donald Trump announced plans to distribute letters within a fortnight to numerous countries, detailing terms of new trade arrangements for their consideration and response.The preliminary agreement between the US and China this week failed to calm markets, particularly given the lack of specific details and Trump's subsequent warning about tariffs."Also President Trump has declared that he will be sending letters to trade partners in the next two weeks setting universal tariffs. Market participants will be waiting and watching for clarity on this. The tariff crisis is not yet over," said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments.3) Global Markets Under PressureInternational equity markets declined on Thursday, negatively affecting Indian markets, as investors assessed recent US inflation statistics, ongoing trade concerns, and unstable global political situations.European markets indicated a downward trend, with Germany's DAX and London's FTSE 100 futures showing declines of 0.8% and 0.4% respectively. S&P 500 futures suggested a subdued opening on Wall Street.In Asian trading, MSCI's broadest regional index excluding Japan decreased 0.2% following its peak performance the previous day. The Japanese Nikkei dropped 0.5%, whilst Chinese and Hong Kong markets retreated from their recent advances.4) Dollar Weakens on Federal Reserve Rate Cut ExpectationsThe US dollar fell to its lowest point in almost two months on Thursday, affected by mild inflation figures and increasing predictions of Federal Reserve interest rate reductions this year.The dollar index reached its lowest since April 22 at 98.246 against major currencies, dropping 0.04% to 98.419. The index has seen a 10% reduction this year.The currency's decline occurred amidst ongoing global trade uncertainty, as investors showed concern about insufficient details in the recent US-China framework deal. These factors, alongside geopolitical issues, reduced market confidence and led investors to decrease dollar holdings.US inflation figures below expectations further weakened the dollar, increasing speculation about Federal Reserve rate cuts possibly starting September. Reuters reports that markets anticipate two 25-basis-point rate reductions by year-end, potentially reaching 100 basis points by September 2026.5) Oil Market FluctuationsOil values decreased Thursday following an earlier rise, as traders evaluated geopolitical risks before US-Iran discussions. Brent crude decreased 0.7% to $69.28 per barrel after Wednesday's 4% surge to a two-month peak."The spike in Brent crude to $70 on heightened security risks in the Middle East is a negative for India. Sectors like paints, adhesives, tyres, and aviation are likely to respond negatively to this, while ONGC and Oil India can respond positively," said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments.ONGC and Oil India shares increased up to 5%, benefiting from better returns due to higher crude prices. However, oil marketing companies including Indian Oil, BPCL, and HPCL declined 2-4.5% over margin worries. Tyre and aviation stocks decreased due to cost concerns, with MRF, CEAT, and IndiGo showing significant losses.(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)