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Indian equity markets fell sharply on Thursday, with the BSE Sensex plunging more than 1,200 points and the Nifty 50 slipping close to the 23,800 mark, as a surge in crude oil prices and weak global signals dampened investor sentiment.

By late morning, the Sensex was down 1,226 points, or 1.58 per cent, at 76,270, while the Nifty dropped 370 points, or 1.53 per cent, to 23,806. The broader market also witnessed heavy selling, with declining shares significantly outnumbering gainers, indicating widespread pressure across sectors.

The downturn follows a brief recovery in the previous session, but renewed concerns over global energy prices and persistent foreign investor selling weighed heavily on the market.

A sharp rise in crude oil prices emerged as a key trigger. Brent crude climbed around 5 per cent to trade near $124 per barrel, fuelling fears of inflation and potential disruption to global supply chains. The spike comes amid geopolitical tensions and discussions led by Donald Trump with oil producers over possible supply constraints linked to Iran.

Higher oil prices are particularly concerning for India, one of the world’s largest importers of crude, as they threaten to push up inflation, weaken the currency and strain economic growth.

Global market sentiment also remained fragile. Overnight, US equities closed mixed, while Asian markets traded lower, reflecting uncertainty following signals from the Federal Reserve that it would maintain a cautious stance on interest rates.

The Fed has held rates steady in the range of 3.50 to 3.75 per cent, adopting a wait-and-watch approach as inflation remains above target levels.

Foreign institutional investors continued to exert pressure, offloading equities worth over Rs 2,400 crore in the previous session. Sustained outflows from overseas investors have been a major drag on large-cap stocks in recent weeks.

Market volatility also spiked, with the India VIX rising more than 11 per cent, signalling heightened nervousness among investors amid geopolitical uncertainty and sharp movements in oil prices.

Selling was broad-based across sectors. Banking, auto, realty and metal stocks all recorded notable declines, while mid-cap and small-cap indices also slipped. The Nifty IT index was among the few segments to remain resilient.

Among individual stocks, Bajaj Finance led the gainers, while several others, including InterGlobe Aviation and Axis Bank, featured among the major losers.

Meanwhile, the Indian rupee weakened to a record low against the US dollar, reflecting concerns over rising energy costs and global monetary tightening. Bond yields also edged higher, tracking movements in US yields and oil prices.

Analysts said the market remains in a fragile phase, with downside risks persisting as long as geopolitical tensions and inflationary pressures continue to dominate investor sentiment.

With PTI inputs