Volatility Soars: India VIX Jumps 58 Per Cent as Markets Brace for Worst Day in 10 Months

On Monday, overall market breadth remained negative, as 138 stocks advanced while 2,643 declined.

Market Update at 12:15 PM: Indian stock markets tumbled sharply on Monday, weighed down by escalating trade war tensions and heightened fears of a U.S. recession, which triggered a global sell-off.

At the opening bell, both indices had plunged around 5 per cent, marking their biggest percentage fall since March 2020. They now appear headed for their worst single-day performance in the last 10 months.

By midday, the Nifty 50 was trading with huge losses, down 950 points from its previous close, trading below the 22,000 mark with losses of 4.5 per cent. Similarly, the Sensex trading is trading lower with a loss of 2,800 points or 3.7 per cent. The Bank Nifty mirrored benchmark indices, down by 3.88 per cent. Meanwhile, the India VIX was trading near the 21 mark, up by 58 per cent, indicating increased volatility in the Indian market.

By midday, all the index constituents were trading in red, where HDFC Bank (-113.18 pts), ICICI Bank (-94.17 pts), and Reliance Industries (-79.38 pts) were dragging the index down.

On Monday, overall market breadth remained negative, as 138 stocks advanced while 2,643 declined. The Nifty Mid-Cap 100 and Nifty Small-Cap 100 indices were trading in deep red, where Nifty Mid-caps were down by 4.6 per cent, and Nifty Small-cap was up by 5.6 per cent

On the sectoral front, all sectors recorded heavy losses, with Nifty Metal, down more than 7 per cent, was the top-losing sector.

Market Update at 10:15 AM: Indian stock markets opened sharply lower on Monday, mirroring a global selloff sparked by escalating fears of a trade war and a looming recession in the U.S. The Nifty 50 index slipped 4 per cent to 21,978, while the Sensex fell 3.5 per cent to 72,700 by 10:10 a.m. IST, though both indices recovered slightly from steeper declines seen during the pre-open session.

Losses were broad-based, with all 13 major sectors trading in the red.

IT stocks, heavily reliant on U.S. revenues, were hit particularly hard, plunging around 7 per cent.

The broader markets also suffered, with small-cap stocks dropping 6 per cent and mid-cap stocks retreating by 5 per cent.

U.S. Federal Reserve Chair Jerome Powell, speaking on Friday, warned that President Trump's newly announced tariffs were "larger than expected," likely weighing heavily on inflation and growth prospects, adding more uncertainty to the economic outlook.

On Wall Street, the Nasdaq officially entered bear market territory on Friday, as a collapse in oil prices and a broad-based selloff in commodities intensified the global market turmoil triggered by Trump’s sweeping tariff announcement earlier in the week.

About 103 stocks are advancing as against 2,554 stocks that are declining, thus indicating a negative market breadth in the broader market.

Pre-Market Update at 7:30 AM: The domestic equity benchmarks, Sensex and Nifty 50, are poised to open significantly lower on Monday, mirroring the heavy sell-off witnessed across global markets. The intensifying US tariffs-led trade war has heightened fears of a looming recession, triggering widespread panic among investors.

Asian markets tumbled sharply today, following the US stock markets, where indices witnessed a steep decline. Dow futures continued their downward trajectory, reflecting deepening concerns over a potential global economic slowdown. Gift Nifty was quoting around the 22,175 mark, showing a substantial discount of nearly 782 points compared to the previous close of Nifty futures, signaling a likely gap-down opening for Indian indices.

On Friday, US markets suffered heavy losses for a second consecutive session amid rising trade tensions worldwide. The Dow Jones Industrial Average plummeted 2,231.07 points, or 5.50 per cent, to settle at 38,314.86. The S&P 500 also recorded a sharp fall, shedding 322.44 points, or 5.97 per cent, to close at 5,074.08, marking its lowest closing level in the past 11 months. Meanwhile, the Nasdaq composite dropped 962.82 points, or 5.82 per cent, to end at 15,587.79.

More than 50 nations have reached out to the White House to begin trade talks since US President Donald Trump rolled out sweeping new tariffs, Treasury Secretary Scott Bessent said, Reuters reported. Neither Bessent nor the other officials named the countries or offered details about the talks. China announced that it will impose a 34 per cent tax on all US goods and export curbs on some rare earths.

The U.S. economy added far more jobs than expected in March. Nonfarm payrolls increased by 228,000 jobs last month after a downwardly revised 117,000 rise in February. Economists polled by Reuters had forecast payrolls advancing by 135,000 jobs after a previously reported 151,000 rise in February. Estimates ranged from 50,000 to 185,000.

President Donald Trump’s new tariffs are “larger than expected,” and the economic fallout including higher inflation and slower growth likely will be as well, Federal Reserve Chair Jerome Powell said, while cautioning it was still too soon to know what the right response from the central bank ought to be, Reuters reported.

“We face a highly uncertain outlook with elevated risks of both higher unemployment and higher inflation,” undermining both of the Fed’s mandates of 2 per cent inflation and maximum employment, Powell said.

US dollar weakened as uncertainty over tariffs and concern over their impact on US growth intensified. Against a basket of currencies, the dollar index fell more than 0.4 per cent to 102.48, having tumbled 1 per cent last week.

US Treasury yields fell and the two-year yield sank to a multi-year low as worries of a possible recession in the world’s largest economy grew. The two-year US Treasury yield tumbled more than 20 basis points to its lowest level since September 2022 at 3.4350 per cent. The benchmark 10-year yield last stood at 3.9158 per cent.

Bitcoin prices plunged amid a sharp sell-off in cryptocurrencies on risk-off sentiment across markets. Bitcoin price dropped about 7 per cent to reach a low point of USD 77,077. Second-ranked token Ether plummeted to USD 1,538, an intra-day low not seen since October 2023.

Crude oil prices plunged on a gloomier outlook for global growth. Brent crude oil plunged 3.16 per cent to USD 63.51 a barrel, while the US West Texas Intermediate (WTI) crude futures declined 3.45 per cent to USD 59.85.

On April 04, 2025, foreign institutional investors (FII) sold shares worth Rs 3,483.98 crore, while domestic institutional investors (DII) sold shares worth Rs 1,720.32 crore.

Stocks that are banned for trading in the F&O segment on April 07, 2025, are Hindustan Copper Ltd Birlasoft Ltd.

Disclaimer: The article is for informational purposes only and not investment advice.