Over ₹5 lakh crore in investor wealth wiped out as global tech rout rattles Nifty

Indian equities were hit by a sharp global technology-led selloff on Tuesday, with the Nifty and Sensex both falling more than 1% and investor wealth eroding by over ₹5.12 lakh crore in a single session. The broader damage came even as foreign investors stayed marginally positive on the day, underscoring that the rout was driven more by global sentiment and broad-based profit booking than by a wholesale institutional exit.

The trigger came from Asia and the U.S. South Korea’s KOSPI plunged 9.99% to 8,203.84, its worst one-day fall in more than three months, after regulators cautioned on leveraged ETFs tied to chip stocks and foreign investors dumped market heavyweights Samsung Electronics and SK Hynix. The decline came a day after the benchmark hit a record high and was severe enough to trigger trading curbs in Seoul.

The weakness was not limited to Korea. Japan’s Nikkei ended 3.55% lower, while China’s Shanghai Composite also slipped nearly 2%. In the U.S., the Nasdaq Composite traded nearly 2% lower and the S&P 500 was down about 1% in early trade, extending the global selloff in technology and AI-linked stocks.

Indian benchmarks join the global slide

In India, the BSE Sensex fell 893 points, or 1.15%, to 76,200.68, while the Nifty 50 declined 278.80 points, or 1.16%, to 23,824.10. Sectoral pressure was broad: Nifty Metal dropped 3.22%, Nifty IT fell 2.23%, Nifty PSU Bank lost 1.97% and Nifty Bank ended 1.30% lower. Pharma was the lone outperformer, with the Nifty Pharma index rising 0.92%.

Market participants said the weakness reflected a mix of global risk aversion, profit booking in domestic stocks and caution ahead of the Nifty F&O expiry, which often amplifies volatility as traders unwind leveraged positions.

Wealth erosion crosses ₹5 lakh crore

The market-cap erosion was more pronounced in the broader market than in frontline indices. BSE data showed total market capitalisation falling from ₹479.72 lakh crore on June 22 to ₹474.59 lakh crore on June 23, translating into a loss of more than ₹5 lakh crore in investor wealth.

‘Broad technology-led correction’

“Indian equity markets witnessed a sharp sell off on Tuesday, mirroring weakness across global equities amid a broad technology-led correction,” said Vishnu Menon, SEBI-registered research analyst and founder of Trader Prepares.

In conversation with Fortune India, he said the decline also came alongside the Nifty F&O expiry, as traders unwound leveraged positions and cut risk in response to deteriorating global cues.

Menon said Asian markets ended sharply lower, with South Korea’s KOSPI plunging 9.99% after touching record highs a day earlier, as investors booked profits in semiconductor heavyweights and reassessed elevated AI-related valuations and funding costs. He added that the selloff was severe enough to trigger trading curbs in Korea.

Menon said the selloff quickly spilled over into global markets. "European markets, including Germany’s DAX, France’s CAC 40, and the UK’s FTSE 100, traded in negative territory, tracking the weakness across Asian equities. U.S. markets also opened sharply lower, reinforcing the global risk-off mood. In early trade, the Dow Jones Industrial Average declined nearly 750 points (1.4%), while the S&P 500 and Nasdaq Composite fell around 1.5% and 2.0%, respectively, led by heavy selling in large-cap technology and AI-linked stocks," he said.

Menon said the correction reflects growing concerns over elevated technology valuations following a prolonged rally. He added that weakness in SpaceX, whose valuation has retreated substantially from post-IPO highs, also weighed on sentiment toward high-growth assets.

"Going forward, investors will closely monitor whether the sharp correction in South Korean semiconductor stocks stabilises, along with developments in the AI sector, U.S. inflation trends, and interest rate expectations. The key question for Asian markets is whether the KOSPI's steep decline is a healthy correction after an extended rally or the beginning of a broader regional risk-off phase," Menon added.