Biggest market crash in 7 months ; investors lost Rs 8 lakh crore in equity wealth

“With this correction, markets have entered into a consolidation phase where stock-specific volatility can be utilized to form the equity portfolios. The stretched valuation segments are witnessing profit booking and money is flowing into value segments where earnings have started to grow after several earnings stagnation,” said Amit Gupta, Fund Manager – PMS, ICICI Securities.

• India VIX, a barometer of volatility, soars 18 percent to 17.5 levels
• Bharti Airtel, Voda Idea gain 8 percent after tariff price hikes
• Reliance Industries falls over 4 percent on cancelation of Aramco deal
• Paytm continues southward journey, tanks 13 percent
• IPO watch: Go Fashions Idea subscribed 110x so far

Some of the major factors that influenced the market are:

Covid lockdowns: Austria said it would reintroduce lockdowns -- and make vaccination mandatory from February -- to fight a worrying jump in new infections. Other countries including Germany, Slovakia, the Czech Republic, and Belgium were also bringing in measures.

Rate hikes earlier than expected?: Bundesbank President Jens Weidmann publicly contradicted the European Central Bank's official line on Friday, warning that inflation may stay above 2 percent for some time and that the ECB should avoid any commitment to keeping the money taps open.

Crude oil falls: Oil extended losses as major consumers including the United States considered releasing some of their reserves to keep a lid on prices, which have been a key reason for the jump in inflation this year.

Broader market indices ended lower, underperforming their headline peers. Nifty Smallcap dropped 2.74 percent and Nifty Midcap declined 3.01 percent. Nifty 500, the broadest index on NSE, ended down 2.13 percent.