Stock market crash: Indian equity markets came under sharp selling pressure on Wednesday, June 3, with benchmark indices, the BSE Sensex and NSE Nifty50, falling over 1 per cent each during intraday trade amid escalating geopolitical tensions in West Asia, rising crude oil prices, and sustained foreign investor outflows.
The BSE Sensex declined 930 points, or 1.24 per cent, to hit an intraday low of 73,719, while the Nifty50 plunged 258 points, or 1.09 per cent, to touch an intraday low of 23,225.50.
At 10:14 AM, the Sensex was trading at 73,762, down 887 points, or 1.19 per cent, while the Nifty50 stood at 23,241, lower by 242 points, or 1.03 per cent.
Among sectoral indices, barring select pharmaceutical and healthcare stocks, most sectors traded in the red. The
Nifty IT index emerged as the biggest laggard, falling over 4 per cent. Realty and select financial services stocks also declined more than 1 per cent each.
Meanwhile,
India VIX, the market’s volatility gauge, rose 6.85 per cent to 16.41.
Market breadth remained weak, with 2,013 of the 3,050 stocks traded on the NSE declining. In comparison, 937 stocks advanced, while 100 remained unchanged.
Stock market crash today: Here’s why the Sensex and Nifty are falling today:
West Asia conflict weighs on sentiment
Investor sentiment remained fragile amid the latest developments in the West Asia crisis. According to AP, the US military said Iranian missiles fired towards Kuwait and Bahrain either failed mid-flight or were intercepted, with no reported damage. In response, US Central Command carried out strikes on an Iranian military ground control station on Qeshm Island near the Strait of Hormuz.
The escalation followed reports of stalled ceasefire communications, although US President Donald Trump said talks were still ongoing.
“The mild escalation in the West Asia conflict has again pushed up Brent crude prices to close to $97, indicating no respite to India from the energy shock. The rupee has edged down to 95.26 against the dollar. The sustained fall in the rupee has been arrested for now, but the rising current account deficit and sustained FPI outflows are areas of concern. The RBI commentary and actions on June 5 will be keenly watched by the market,” said VK Vijayakumar, chief investment strategist at Geojit Investments.
Vijayakumar noted that the bull run in semiconductor majors in South Korea and Taiwan continues unabated, driven by expectations of strong earnings growth from companies such as Samsung, SK Hynix and TSMC.
“In contrast, earnings growth in India in FY27 will be modest, weighed down by lower growth and higher inflation. All these factors have impacted market sentiment. The saving grace is the confidence shown by retail investors, who continue to invest despite the headwinds. Even though sustained FPI outflows remain a strong headwind, fair valuations, recovery in earnings growth reflected in Q4 numbers, and strong domestic flows can impart resilience to the market,” he added.
US proposes additional tariffs on imports from India
The United States Trade Representative (USTR) has proposed imposing additional duties on imports from 60 economies, including India, citing their failure to ban and adequately enforce restrictions on products made using forced labour.
The proposal has been made under Section 301 of the US Trade Act, 1974, which authorises the US government to take action against foreign policies or practices deemed unfair or harmful to American trade interests.
India has rejected the allegations and urged Washington to address trade concerns through ongoing negotiations rather than unilateral tariff measures, according to a Bloomberg report.
IT stocks bear the brunt
Information technology stocks witnessed heavy selling, dragging the Nifty IT index down 4.26 per cent to an intraday low of 29,677.55.
At last check, the index was trading at 29,694.85, down 4.57 per cent.
TCS emerged as the top loser, falling around 7 per cent. Infosys and Coforge declined more than 4 per cent each, while LTM lost around 6 per cent. HCLTech and Mphasis were down over 3 per cent each.
Rising crude oil prices
Higher crude oil prices further dampened investor sentiment. At last check, Brent crude was trading 1.08 per cent higher at $97.04 per barrel, while WTI crude gained 1.21 per cent to $94.89 per barrel.
Continued FII selling
Foreign Institutional Investors (FIIs) remained net sellers for the fifth consecutive trading session on June 2, 2026, offloading equities worth ₹8,362 crore. Domestic Institutional Investors (DIIs), however, continued to provide support, purchasing equities worth ₹9,589 crore and absorbing a large part of the foreign selling pressure.
“At present, investor sentiment remains cautious and highly sensitive to incoming developments. The lack of tangible progress in US-Iran negotiations, elevated crude oil prices, and continued foreign fund outflows continue to reinforce a risk-off environment. While strong domestic liquidity is providing an important buffer, a more durable improvement in sentiment is likely to require greater clarity on the geopolitical front and a sustained easing in energy prices. Until then, markets are expected to remain largely headline-driven, with volatility likely to stay elevated,” said Ponmudi R, chief executive officer of Enrich Money.
Technical view
From a technical perspective, Anand James, chief market strategist at Geojit Investments, said lower Bollinger Band support helped prices recover from the opening low in the previous session, though gains remained capped near the 23,500 mark.
“If the dips are contained in the 23,400-23,380 region today, a renewed push towards 23,700 could be seen. Inability to do so should expose 23,126-22,800 again,” James said.
