On Tuesday, the stock market saw its biggest intraday percentage decline in four years, sending it plunging more than 6%. While the Nifty fell 6.2% to 21,824 points, the Sensex fell 6.1% to 71,900 points. Since March 2020, this was their largest percentage decline in a single day.
The dramatic sell-off reduced the businesses' overall market value by almost Rs 45 lakh billion.
It undid all the advances that had been achieved on Monday when exit polls indicated that the governing BJP alliance would win handily in the national elections.
Early trends in Tuesday's vote counting indicated that Prime Minister Narendra Modi's alliance did not secure the predicted landslide win. According to news outlets, the NDA, led by the BJP, is ahead in about 300 seats.
The indicator reached its highest peak since March 2022, 29.79 points, as volatility surged. All sectors' stocks saw a lot of selling. Real estate sank 9.1%, infrastructure fell 10.5%, and banking shares lost 7.8%.
The largest losses were the Adani group firms' shares, with Adani Enterprises and Adani Ports plunging 19% apiece. After gaining on Monday, other Adani stocks had a decline of 9–19%.
Experts in the market noted that exit polls had increased predictions of a larger BJP majority, which is why the crash occurred.
Anand James of Geojit Financial told Reuters, "Since exit polls were extremely favourable, anything short of that is obviously negative for markets."
Mayuresh Joshi of William O'Neil continued, "Exit polls were helping the markets price in a larger majority. The present concern is whether the numbers would continue to decline, which would be disappointing.
Although it appears that the BJP will form the next government, economists predict that markets will remain turbulent in the upcoming sessions until further clarity on policy announcements and government formation is obtained.
