The tremors of the infamous conflict between two formerly united Soviet countries have been felt miles away in the Indian stock market. The bulls of the stock market came crashing down and Sensex tumbled at 4.72 percent to close at 54,529.91. The conflict triggered sell-off across global markets and rising oil and gas prices.
Dalaal Street’s Biggest Crash in 2 years:
Investors have turned cautious after Russian President Vladimir Putin has announced a special military operation in Ukraine’s Donbass region. Russia has already begun to position soldiers in the region and the situation is elevating into a war-like conflict.
This speculation has caused the Dalaal Street investors to suffer a total investor loss of Rs. 13.6 lakh crores, which is evidently the biggest since the past two years. On BSE, the overall market breadth was weak as 2378 shares declined with a meager rise in just 270 shares.
The blue-chip NSE-Nifty 50 Index was down to 2.43 percent, with the top loser being Tata motors with a total fall of more than 10%. Other than that, IndusInd Bank, JSW Steel, Adani Ports, Bharat Petroleum, and Tata Consumer were other firms suffering huge losses.
European markets traded higher when all the Asian ones ended in the red. London-based FTSE added 2.88% and Paris added 4.27%.
Impeding inflation ahead to the crisis:
Global prices of crude oil have crossed the $100 per barrel mark for the first time since 2014. Shares in Russia tanked more than 50 percent and prices of European gas surged as much as 30%.
The rupee has slid to 58 paise and gold prices rose by Rs 1600. The increase in gold prices was reportedly due to the speculation on sanctions on Russia which will lead to a disruption in the supply of such commodities. Experts suggest that this situation may turn into a “buy-in dip market” one, where people buy stocks during the downfall anticipating the stock market rise as soon as the global tension calms.
Global tensions affect all:
Since time immemorial the world has witnessed how conflicts between two or more nations affect the whole world. The World Wars and The Great Depression spared no country. Thus, to think that India will remain unaffected by the Russia-Ukrainian crisis is a mere misconception. It has already resulted in market crashes and inflation and will soon escalate into deeper issues. The problem needs to be recognized as early as possible and measures should be taken with as little optimistic nature as possible because hoping for the situation to dissolve itself will be flawed and foolish.
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