(Bloomberg) — Indian stocks joined a global selloff as Russian forces attacked targets across Ukraine, triggering the worst security crisis in Europe since World War II.
The benchmark S&P BSE Sensex closed 4.7% lower, the most since May 2020. The NSE Nifty 50 Index slumped as much as 4.8%. Both measures, which were the worst-performing among major stock benchmarks in Asia on Thursday, fell as much as 5% earlier in the session. The indexes dropped for a seventh day, their longest losing streak since March 2020.
The sharp drop coincided with the expiry of February derivatives on Thursday. The India NSE Volatility Index surged 30%, the biggest jump since March 2020. The rupee fell 1.4%, the most since April 2021, while yields on benchmark government bond rose two basis points to 6.76%.
Russia launched a barrage of missile, artillery and air attacks early on Thursday as President Vladimir Putin vowed to “demilitarize” the country and replace its leaders. Global stocks tumbled while bonds and oil soared. The Asia stock benchmark dropped as much as 2.8% to the lowest since November 2020.
“A number of negative factors have come together for India, from foreign selling to expiry of derivative contracts today, which resulted in a sharp selloff,” said Anita Gandhi, a strategist at Mumbai-based Arihant Capital Markets Ltd. Trading in India is expected to be in line with the global trend in the next few sessions as there are no immediate local triggers, she said.
Reliance Industries Ltd. contributed the most to the Sensex’s decline, falling 5%, followed by a 5.5% slump in HDFC Bank Ltd. All 30 stocks in Sensex fell.
(Updates to add strategist comment in fifth paragraph)
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