Indian equity indices experienced a sharp decline on Tuesday after early counting trends indicated a fierce contest between the NDA and the opposition INDIA bloc in the Lok Sabha elections. Investors saw nearly ₹40 lakh crore wiped out as equity benchmarks plunged following the initial election trends that began emerging on Saturday.
By 1 p.m. on Tuesday, BSE’s market cap had dropped to ₹400 lakh crore from ₹426 lakh crore at Monday’s close. The markets opened with a significant drop on Tuesday morning. In early trade, the Sensex slipped 2,713 points (3.55%), and the Nifty fell 838 points (3.65%).
By 1 p.m., the Sensex stood at 70,740, down 5,690 points (6.83%), and the Nifty was at 21,300, down 1,544 points (6.92%). The India volatility index (India VIX) surged 33% to 27.59 points.
This came after a significant rise on Monday when exit polls predicted a favorable outcome for the current government. On Monday, the Sensex closed 2,507 points (3.39%) higher at 76,468 points, while the Nifty ended 733 points (3.25%) higher at 23,263 points.
