Indian equity benchmarks crashed on Tuesday, September 15, with the Nifty 50 plunging to a five-month low as a triple blow of surging crude oil prices, multi-year highs in US bond yields, and a weakening rupee triggered a broad-based selloff. The Nifty 50 settled at 23,118.60, down 279.50 points or 1.19%, while the BSE Sensex tanked 777.94 points, or 1.04%, to close at 74,003.82 [citation:1][citation:2].

The market opened on a firm note, with the Nifty touching an intraday high of 23,592.85, but the rally fizzled out quickly as selling intensified through the session. The index hit an intraday low of 23,118.60 before closing at the day's lowest point [citation:6][citation:11].

Key Driver: IT was the sole sectoral gainer, with Nifty IT surging 2.19% as HCL Tech, Infosys, and TCS rallied. All other sectors bled, with Defence plunging nearly 6%, Realty falling 4.04%, and Metal, PSU Bank, and Media each dropping over 2% [citation:1][citation:5].

Market Cap Erosion: Investors lost approximately ₹8.67 lakh crore in Tuesday's session, with market capitalization of BSE-listed companies falling to ₹4,72,89,280 crore [citation:2][citation:11].

Brent crude oil futures surged to around $108 per barrel on Tuesday, the highest level in months, as escalating Middle East conflict between the US and Iran kept supply disruption fears alive. The sharp spike in crude prices poses a significant risk to India's inflation and current account deficit, given the country is the world's third-largest crude oil importer [citation:4][citation:15].

Forex traders noted that surging dollar demand from oil importers has sparked fresh concerns over inflation and India's external trade balance. With Brent touching $108, increased dollar demand from oil importers raised concerns over the country's external balance [citation:15].

Outlook: Markets will closely monitor US-Iran diplomatic developments and any further escalation in the Strait of Hormuz. The crude trajectory remains the single biggest risk factor for Indian equities.

The rupee depreciated 38 paise to close at 95.92 (provisional) against the US dollar on Tuesday, weighed down by escalating Middle East conflict and soaring Brent crude oil prices. The currency opened at 95.84 and lost ground through the session, closing near its low [citation:4][citation:10].

India VIX, the volatility gauge for the Indian equity market, spiked 9.28% to close at 13.43, up from the previous close of 12.29. The index moved between 11.92 and 13.58 during the session, signaling a sharp rise in market anxiety [citation:3][citation:9].

FII/DII Flows: Foreign institutional investors remained net sellers amid global risk-off sentiment. Domestic institutional investors provided limited support.