Rising oil, weak rupee and rate fears hammer Dalal Street; VIX jumps 10%

Mumbai: A sharp sell-off engulfed Indian equities on Thursday, with the Sensex and Nifty dropping over 1.4% each to their 2026 lows as the prospect of higher interest rates, elevated crude prices and continued weakness in the rupee further fuelled risk-off sentiment.

The BSE Sensex fell 1,045.46 points or 1.44% to close at 71,593.24-the lowest closing since February 2024.

The Nifty declined 371.25 points or 1.64% to close at 22,231.80-the lowest closing since April 2025.


The fall wiped out around ₹10 lakh crore from the market capitalisation of BSE-listed companies.

Adani Enterprises fell 5.4%, while JSW Steel and ITC dropped 4.5% and 4%, respectively.

India's Volatility Index or VIX, the street's fear gauge, shot up by 10.26% in response to the uncertainty. Elsewhere in Asia, China sank 0.8%, Hong Kong fell 1.4%, South Korea declined 2.7% and Taiwan dropped 0.9%. The pan-Europe index Stoxx 600 was down 0.3% at the time of going to print. Jitters over the outlook on India have been elevated of late on account of a number of factors, but higher oil prices and global central banks signalling further interest rate increases are bothering investors the most.

"The market is witnessing a barrage of bad news-rising rates globally, weakening rupee, triple-digit oil prices, IPO supply, political protests, supply chain disruptions, below-average monsoon, lack of AI opportunities and FPI selling," said Nilesh Shah, MD, Kotak Mahindra Asset Management Co.

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After Thursday's fall, the Sensex has slid nearly 16% and the Nifty has dropped 15% so far in 2026, resulting in Indian stocks emerging as among the worst performers globally.

On Thursday, the Nifty Midcap 150 and the Nifty Small-cap 250 dropped 2.4% each.

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Of the 4,654 shares traded on the BSE, 3,545 declined, while 910 advanced.

So far in 2026, the Nifty Midcap 150 is down 4.3%. The Nifty Smallcap 250 is up 4.8%.

Brent crude surged 4.1% to above $104 a barrel on Thursday, due to renewed worries about the lingering West Asia conflict.