Why the Sensex Crashed Today

On December 2, 2025, the Sensex experienced a sharp decline, crashing over 500 points to close at 85,138.27, down 503.63 points or 0.59 per cent. The NSE Nifty50 also slid, settling at 26,032.20, down 143.55 points or 0.55 per cent. This drop followed a day that started on a negative note, with both indices declining throughout the session after opening lower.

Several key reasons contributed to this market fall. Firstly, weak global cues influenced investor sentiment, as markets in Asia and the US showed signs of weakness, instilling caution among traders. Secondly, persistent foreign institutional selling added downward pressure. Thirdly, there was profit booking after recent highs, which is a common trigger for such corrections. Lastly, there were concerns around crude oil prices, which rose amid OPEC+ decisions to keep output levels steady, increasing import costs for India, thereby impacting the market negatively.

Additional factors included a weakening rupee, which put further pressure on the market despite strong GDP growth, and reduced expectations of any near-term rate cuts by the Reserve Bank of India (RBI), which raised the benchmark bond yields. These combined domestic and international triggers culminated in a broad-based selloff that disproportionately affected index heavyweights and sectors sensitive to global trade and commodity prices.

The top Sensex stocks that fell significantly included major heavyweights such as HDFC Bank (-1.07 per cent), ICICI Bank (-1.17 per cent), Reliance Industries (-1.14 per cent), Axis Bank (-1.05 per cent) and InterGlobe Aviation (-1.62 per cent). These stocks were among the biggest drags on the indices, contributing heavily to the overall decline.

Sector-wise impact analysis shows the private banking and financial services sectors led the selloff, with Nifty Private Bank falling 0.69 per cent. Other sectors that experienced notable declines were consumer durables (-0.44 per cent), oil and gas (-0.42 per cent), media (-0.4 per cent), and metals (-0.36 per cent). On the contrary, sectors like pharma saw slight gains, and PSU banks showed relative resilience compared to private lenders.

This sectoral weakness indicates investors reduced exposure primarily to private banks amid profit booking and global uncertainties, while defensive and government-backed sectors were somewhat steady during the fall.

The crash was driven by a mix of unfavourable global sentiment, foreign selling pressure, profit-taking, a weak rupee, and rising crude prices that collectively dampened investor confidence and led to a broad market downturn. The market’s cautious stance also reflected macroeconomic factors influencing valuations and liquidity flows on the day.