After the Indian government confirmed two cases of Human Metapneumovirus (HMPV) in Karnataka and one in Gujarat, amid tales of a virus outbreak wreaking havoc in China, stock market investors elected to remain cautious. As a result, the Sensex sank by more than 1,400 points, while the Nifty lost almost 1.7%.
The India VIX fear gauge index increased by 17% as a widespread sell-off occurred across mid and small-cap equities, as well as in numerous sectors. The Sensex plunged nearly 1,400 points to a day low of 77,782, while the Nifty fell below 23,600.
Metals, PSU banks, real estate, oil and gas, and financials were among the hardest-hit industries. Union Bank of India’s shares sank 7%, while Bank of Baroda, HPCL, BPCL, Tata Steel, Adani Energy Solutions, and PNB were all down approximately 4-5%.
The Sensex was weighed down by heavyweights like HDFC Bank, Reliance Industries (RIL), and Kotak Mahindra Bank.
What triggered the stock market crash today?
While investors were watching earnings announcements and predictions for the Q3 results season, which starts this week, as well as developments surrounding the Trump presidency and geopolitical challenges, the news concerning HMPV in India caught them off guard.
While confirming the detection of two HMPV cases in Karnataka, the Union Health Ministry stated that the cases were discovered during routine surveillance for several respiratory viral pathogens, as part of the ICMR’s ongoing efforts to monitor respiratory disorders across India.
Both cases involve infants who had never travelled internationally before. While a 3-month-old female newborn was discharged from Baptist Hospital in Bengaluru after being treated with bronchopneumonia, an 8-month-old male infant who tested positive for HMPV on January 3, 2025, is now recovering.
“It is emphasized that HMPV is already in circulation globally, including in India, and cases of respiratory illnesses associated with HMPV have been reported in various countries. Furthermore, based on current data from ICMR and the Integrated Disease Surveillance Programme (IDSP) network, there has been no unusual surge in Influenza-Like Illness (ILI) or Severe Acute Respiratory Illness (SARI) cases in the country,” the Health Ministry said.
According to a statement, the ministry is monitoring the situation using all available surveillance channels.
“ICMR will continue to track trends in HMPV circulation throughout the year. The World Health Organization (WHO) is already providing timely updates regarding the situation in China to further inform ongoing measures. The recent preparedness drill conducted across the country has shown that India is well-equipped to handle any potential increase in respiratory illnesses and public health interventions can be deployed promptly if needed,” the ministry said.
According to NSDL data, FII outflows have already had an impact on the stock market, totalling around half a billion dollars in January.
“The market is likely to be influenced by the negative factors impacting FII flows and some positive domestic factors which can support the market. The external macro construct continues to be unfavourable with the dollar index at 109 and the 10-year US bond yield at 4.62%. The FIIs are likely to continue selling till the yields decline and the dollar stabilizes, Dr V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said.
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