Sensex, Nifty 50 Crash, Then Strike Back as India Defies Global Chaos

India’s stock market took its steepest single-day hit in months this week, then clawed back the losses within days, while the country’s payment system, chip industry, and crypto rules kept moving forward underneath the volatility. The country has stood among the most resilient economies across the vast majority of the world’s leading economic powers amid the conflict in the Middle East.

The Sensex fell 1,677 points on July 8, a 2.15% drop, after renewed fighting between the United States and Iran ended a fragile truce. India’s Sensex serves as the benchmark equity index of the Bombay Stock Exchange (BSE), measuring the performance of 30 of the country’s largest and most actively traded companies spanning the principal sectors of the Indian economy.

Foreign institutional investors sold heavily during the two-week stretch, including a net outflow of about 3,062 crore rupees on July 13. Indian mutual funds and other domestic institutions bought through the selloff, adding roughly 2,000 to 3,000 crore rupees on most trading days. That buying kept the market from a deeper slide.

Financial stocks, including Bajaj Finance, Axis Bank and State Bank of India, led the recovery. Information technology and metals stocks lagged on several sessions as oil prices stayed elevated.

NITI Aayog, the government’s policy think tank, has set a target of capturing 10% to 13% of the global semiconductor market by 2035, tied to a projected $120 billion to $150 billion value chain. The bet is backed by demographics. India’s population of about 1.48 billion includes a working-age share of 66% to 68%, a base the IMF cites as a core reason the country is expected to grow 6.4% in the 2026-27 fiscal year, well above the global average.