Indian indices plunge over 1% as oil spikes and RBI rate hike fuel sell-off

On Thursday, India’s benchmark indices tumbled, with the Sensex losing as much as 785 points (about 1.09%) to 71,853.90 and the Nifty 50 falling 274 points (around 1.21%) to 22,603. The sell-off was sparked by a more than 2% jump in crude oil, pushing Brent futures above $102 per barrel and stoking inflation worries for the world’s third-largest oil importer. The Reserve Bank of India responded to rising prices by lifting its key rate by 25 basis points to 7.5%, its first increase in almost four years, and signaled possible further hikes.

Global equity sentiment was also negative, with declines in Japan, Hong Kong and South Korea and US Treasury yields climbing to 5.31%, making equities less attractive. Analysts noted that the Nifty’s daily red candle and resistance around 22,700 could lead to additional weakness unless it breaks higher, while a move below 22,500 may see the index test lower ranges.