Why Is the Market Falling Today?

Benchmarks Slide Sharply In Opening Trade

Indian equity benchmarks declined sharply in morning trade on March 2 following joint U.S.-Israel strikes on Iran on February 28 and subsequent retaliatory action.

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The BSE Sensex opened 2,743 points, or 3.34%, lower at 78,543.73, according to exchange data. It later pared losses and was trading 830 points, or 1.02%, lower at 80,457 around 10 am.

The Nifty 50 fell more than 500 points, or over 2%, to an intraday low of 24,645 before trimming losses to trade 262 points, or 1.04%, lower at 24,917 around 10 am.

Overall market capitalisation of BSE-listed companies declined to ₹455 lakh crore from ₹463.50 lakh crore in the previous session, resulting in an erosion of more than ₹8 lakh crore within minutes of opening, as per exchange data.

Crude Oil Jumps Above $82

Crude oil prices rose sharply amid concerns over supply disruptions near the Strait of Hormuz. Brent crude climbed above $82 per barrel before easing near $78, while West Texas Intermediate traded around $75 per barrel, according to Reuters price data.

In over-the-counter trade on Sunday, Brent crude rose about 10% to near $80 per barrel. Economists have estimated that a $10 per barrel increase in crude prices could raise India’s annual import bill by ₹10,000-₹15,000 crore.

India imports around 85% of its crude oil requirement, according to government data.

Rupee Weakens Past 91 Per Dollar

The Indian rupee fell 28 paise to 91.26 against the U.S. dollar, crossing the 91 mark for the first time in one month, according to Bloomberg data.

Foreign Outflows Continue

Foreign institutional investors sold ₹11,002 crore worth of equities in the cash segment in February, marking the eighth consecutive month of net selling, according to exchange data.

GDP Data Released

On February 28, the Ministry of Statistics and Programme Implementation reported that India’s GDP grew 7.8% in the October-December quarter. The FY26 growth estimate was revised to 7.6% from 7.4% projected in January. Nominal GDP growth for FY26 is estimated at 8.6%, compared with 9.7% a year earlier, according to official data.

With geopolitical tensions intensifying, crude oil prices elevated and foreign flows remaining negative, domestic markets reacted sharply in early trade on March 2.