Noida, May 12 (APAC Media): The benchmark equity indices, Sensex and Nifty 50, witnessed a sharp selloff on Tuesday, as markets came under pressure amid weak global cues, rising crude oil prices, and continued foreign portfolio investor outflows.
The BSE Sensex plunged more than 1,300 points during intraday trade, while the NSE Nifty slipped below the crucial 23,400 mark, reflecting heightened investor nervousness across sectors.
Heavy selling pressure was seen in banking, information technology, auto and metal stocks as traders rushed to cut risky positions following concerns over inflationary pressures and geopolitical uncertainty.
US President Donald Trump has said the fragile ceasefire between Washington and Tehran is on “massive life support”, raising fresh doubts over the prospects of a lasting truce.
Earlier, Iran responded to American peace proposals, demanding an end to hostilities, lifting of US… pic.twitter.com/YiaFcRxWCq
— All India Radio News (@airnewsalerts) May 12, 2026
“It is at its weakest. After reading what they sent us, it’s ‘garbage.’ It’s on life support—massive life support,” Mr. Trump told reporters.
Market participants said a spike in global crude oil prices after renewed tensions in West Asia weighed heavily on investor sentiment, particularly for import-dependent economies such as India.
Investors’ wealth declined by nearly Rs 16.1 lakh crore amid the ongoing market rout, with the total market capitalisation of BSE-listed companies dropping to Rs 457 lakh crore on Tuesday from Rs 473 lakh crore on May 6.
In a single session on Tuesday, investors lost more than Rs 10 lakh crore as the market capitalisation of listed firms fell sharply from Rs 467.3 lakh crore recorded on May 11, reflecting intense selling pressure across sectors.
The steep erosion in market value followed a sharp fall in benchmark equity indices, triggered by weak global cues, rising crude oil prices and sustained foreign institutional investor outflows, which continued to weigh on overall investor sentiment.
The sharp rise in oil prices also triggered worries about corporate margins and consumer demand, leading to broad-based selling in equities.
Foreign institutional investors (FIIs) remained net sellers in the Indian market, extending their recent withdrawal trend amid stronger US bond yields and a firm dollar.
The Indian rupee weakened further against the US currency during the session, adding to concerns over imported inflation and capital outflows.
However, broader markets also remained under pressure, with midcap and smallcap indices declining sharply in tandem with the benchmark indices.
Most sectoral indices ended in negative territory, although shares of oil exploration and energy companies outperformed on expectations of higher earnings amid elevated crude oil prices.
Traders said market volatility remained elevated throughout the session as investors reacted to global developments and indulged in profit-booking following recent gains. Cautious sentiment ahead of key domestic inflation data and concerns over slowing global economic growth further weighed on investor confidence.
The market decline erased several lakh crore rupees in investor wealth in a single trading session, underscoring the fragile sentiment currently prevailing in equities.
Disclaimer: Views expressed are those of experts and do not reflect APAC Media. This is for informational purposes only, not financial advice. We are not responsible for investment decisions. Please consult a qualified financial advisor before investing.
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