The Sensex tanked 1,045.46 points on Wednesday to close at 71,593.24. The Nifty fell 371.25 points to 22,231.80.

The selloff was driven by a spike in oil prices. Brent crude jumped 4.25 percent to $104.5 a barrel as US-Iran tensions escalated. Heavy selling hit rate-sensitive, commodity and FMCG stocks.

The RBI added to the pressure by hiking the repo rate to 5.50 percent on Wednesday. Higher rates typically hurt borrowing-heavy sectors.

The rupee also weakened sharply, trading at 96.88 against the dollar. That makes imports, including oil, more expensive for India.

According to market data, investors lost around Rs 10 lakh crore in Thursday’s intraday crash, making it one of the steepest wealth-erosion sessions this year.

Midcap and smallcap indices also fell sharply, showing the selloff was broad-based and not limited to blue chips. Analysts advised retail investors to avoid panic selling and wait for global cues to stabilize. Market breadth was deeply negative, with far more stocks declining than advancing.