Indian equity indices retreated sharply amid prevailing market volatility, with the Sensex closing at 72,772, a decline of 1,124 points, and the Nifty falling below the 23,000 threshold. The session eroded an estimated ₹7 lakh crore in investor wealth.
The Sensex fell below the 73,000 level on Thursday, marking the index's lowest point in six months amid a sustained period of losses. Equity market losses wiped out approximately ₹7.5 lakh crore in investor wealth, bringing the combined market value of all BSE-listed companies from approximately ₹483 lakh crore at the close of trading on Friday to roughly ₹475 lakh crore. The erosion in shareholder value amounted to roughly 14% of India's annual government expenditure and fell just short of the nation's defence allocation.
Financial analysts have linked the recent downturn to a rise in the cost of crude oil. Ongoing tensions between the US and Iran have weighed on international markets, keeping crude oil prices at elevated levels. Global oil benchmarks moved higher, with Brent crude climbing above the $108 mark, reflecting a gain of roughly 4%, and crude prices holding above the $100 mark as diplomatic friction between the United States and Iran persists.
Overseas investors have continued pulling capital out of Indian equity markets, placing downward pressure on domestic investor confidence. Overseas investors have withdrawn approximately ₹2,45,000 crore from Indian equity markets so far in 2026, with disposals picking up again in September despite a brief return to the market over the preceding two months. Elevated yields on American government bonds have drawn overseas capital away from Indian markets toward the United States.
The Sensex declined from 85,572 on 27 September 2024 to 80,426 by 26 September 2025, with the figure standing at 72,772 from that point forward. The index has shed approximately 12,800 points, a decline of roughly 15%, across a two-year period.
Investors have expressed unease following the downturn in equity markets. A growing number of investors have redirected funds toward equities and mutual funds rather than traditional bank deposit accounts, with approximately 90 million demat accounts registered across the country by 2022. That figure has climbed to 240 million, reflecting growth of approximately 166% over a four-year period. Investors holding both direct equities and mutual fund positions are experiencing portfolio declines, particularly when redemptions are required at a time of negative returns.
Precious metals also recorded losses during the period. The India Bullion and Jewellers Association reported that 24-carat gold rates in the wholesale market dropped by more than ₹4,000 per 10 grams, pushing the price below the ₹1,48,000 mark. The price of silver dropped by ₹9,297 per kilogram, bringing it to ₹2,23,000. Through September so far, gold prices have dropped approximately ₹8,000 while silver has fallen by around ₹14,000.
Throughout 2025, gold appreciated by approximately 74% while silver recorded gains exceeding 160%. On 29 January, the price of 24-carat gold climbed to an all-time high of ₹1,83,000 per 10 grams, with silver also surpassing the ₹4 lakh threshold. Compared with the start of the year, gold has dropped by roughly 19% in value, while silver has lost approximately 45% of its price.
Analysts indicated that market turbulence is likely to continue for as long as hostilities between the two nations remain unresolved.
