Spike in US bond yields weighs on Indian stock market; Sensex drops over 800 points

The Indian stock market faced a sharp decline on May 22, with the Sensex plummeting over 800 points, closing at 80,727.11.
The Nifty 50 also fell below 24,550, reflecting a broader negative sentiment driven by rising US bond yields and concerns over the US fiscal deficit.
VK Vijayakumar, Chief Investment Strategist at Geojit Investments, noted, "The fundamental issue is the US's high fiscal deficit, which the market feels is unsustainable."
The market opened on a negative note, with the Sensex starting at 81,236.18, down by 360 points or 0.44%.
Experts highlighted that mixed Q4 earnings have failed to boost market sentiment, with Nifty-50 net profits growing only 7.5% year-on-year.
The decline in the Indian markets was exacerbated by a significant drop in US equities, where the Dow fell 816.80 points (1.9%) and the S&P 500 dropped 95.85 points (1.6%).
Analysts pointed out that the recent rally in Indian markets had stretched valuations, particularly among large-caps, while mid- and small-caps are trading at lofty valuations.
The market's resilience was evident, but it lacked the momentum to push higher, as indicated by the formation of a green hammer pattern.
Overall, the Indian stock market's performance reflects a complex interplay of domestic and international economic factors.

The Indian stock market experienced a significant downturn, with the Sensex dropping over 800 points amid rising US bond yields and concerns over the US fiscal deficit. The Nifty also fell, reflecting a broader negative sentiment in the market as investors reacted to global economic pressures.