Nifty Below 22,700; All Sectors In Red— Three Reasons Why Markets Are Crashing Today

Indian markets are under heavy pressure in Monday's session as escalating tensions in the Middle East have triggered a broad risk‑off move.

At 9:30 am, the Nifty slid more than 400 points (down nearly 2%) to below 22,700 while the Sensex dropped over 1,200 points (down 1.70%) to nearly 73,277.

The Nifty index has slipped to its lowest level since April 9, 2025, extending a steep decline that has already seen it drop more than 10% in March alone. This marks its worst monthly performance since March 2020.

With the latest fall, the benchmark is now down over 14%—or more than 3,700 points—from its all‑time high, underscoring the depth of the ongoing market correction.

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All sectors are trading in the red, with Nifty Metal falling the most by over 3.5%, followed by PSU Bank plunging by over 3%.

The broader market is facing even more pressure, with the Nifty Smallcap 250 falling almost 2.3%, and the Nifty Midcap 150 dropping about 2.24%. Volatility spiked sharply, with the India VIX — the market's fear gauge — surging 10.85% to 25.30.

Here are three key reasons dragging the markets on Monday.

Middle East Tensions

Monday marked the 24th day of the ongoing hostilities involving the US, Israel, and Iran, with no signs of tensions easing on any side. The conflict, which began on February 28, has continued to escalate despite US President Donald Trump stating last week that he was considering scaling back operations. So far, the fighting has claimed more than 2,000 lives, unsettled global markets, and driven a sharp rise in oil prices.

Oil prices showed limited movement today despite heightened geopolitical rhetoric, as traders weighed fresh threats around the Strait of Hormuz. Brent crude hovered just below $112 per barrel, while US benchmark WTI remained near $98, reflecting a market that is alert-but not panicked.

ALSO READ: Brent Crude Holds Steady At $112 As Hormuz Tensions Escalate With Trump's Ultimatum

Rupee Under Pressure

The rupee opened at a fresh record low of 93.83 against the US dollar, slipping 12 paise at the start of Monday's session. The currency continued to weaken in early trade, declining further by 13 paise to touch 93.84, extending its downward trajectory amid persistent pressure.

The yellow metal rate on India's MCX plunged nearly 5% on Monday, March 23, amid ongoing geopolitical tensions. At 9:01 am on Monday, the MCX gold April futures contract fell 4.98% to Rs 1,37,399 per 10 grams, while MCX silver May futures contract dropped 5.95% to Rs 2,13,290  per kg.

ALSO READ: Gold Price Today: Yellow Metal Tumbles 5% On MCX Amid Geopolitical Tensions

Global Cues

Asian equities extended their decline, with South Korea's Kospi tumbling 5.8%, Japan's Nikkei 225 sliding 3.5%, Hong Kong's Hang Seng dropping 3.4%, China's Shanghai Composite slipping 2.5%, and Australia's ASX 200 easing 0.8%. Japan's broader Topix index also fell sharply, losing 4.4%, while South Korea's Kosdaq retreated nearly 5%.

Trading in South Korea was temporarily halted after Kospi 200 futures plunged more than 5%, triggering circuit‑breaker rules.

Asian equities declined for a third straight session and were on the brink of a correction, while bond markets also weakened as investors grew worried that the prolonged conflict could fuel inflation, dampen economic growth, and potentially force central banks to revisit rate‑hike options. Futures pointed to continued losses in Europe and the US.

Global financial markets have been shaken by the Middle East turmoil, with both stocks and bonds slipping last week as concerns over rising prices and slowing growth mounted. Policymakers are feeling the pressure as well, with Federal Reserve Chair Jerome Powell noting that the central bank needs clearer evidence of cooling inflation before considering further rate cuts.

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