Sensex falls 800 points, Nifty below 23,000: Why are markets falling today?

The stock market came under heavy selling pressure on Monday, with the Sensex falling nearly 900 points and the Nifty slipping below the 23,000 mark.The decline comes after the benchmarks recorded their seventh consecutive weekly fall, with a combination of rising crude oil prices, weakness in financial stocks and continued foreign investor selling weighing on sentiment.At 9:42 am, the Sensex was down 900.50 points, or 1.22%, at 72,995.24, while the Nifty 50 fell 275.45 points, or 1.19%, to 22,865.05. Both benchmarks slipped further after opening lower, with the Sensex falling below the 73,000 mark and the Nifty trading below 22,900.Here are the three key reasons behind Monday's fall: CRUDE OIL HAS RISEN ABOVE $106The biggest global concern for Indian markets remains crude oil.Brent crude rose 2.20% to $106.61 a barrel, while WTI crude gained 1.45% to $93.75. Oil prices have risen amid uncertainty over US-Iran talks and concerns around the Strait of Hormuz. India is particularly sensitive to oil prices because of its dependence on crude imports. Sustained higher oil prices can increase the country's import bill, put pressure on inflation and weigh on corporate margins.The rise in crude has also pushed global bond yields higher, adding another layer of pressure on equity valuations.Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said, "Brent crude at $106 and the US 10-year yield at 5.2% are strong headwinds that are weighing on markets. FPIs, after turning buyers in July and August have again turned sellers in September. This scenario will keep the market under pressure in the near-term."BANKING AND FINANCIAL STOCKS ARE TAKING A HITFinancial stocks are again among the biggest losers, extending the pressure seen last week.Bajaj Finance fell 1.59%, Kotak Mahindra Bank declined 1.38%, HDFC Bank dropped 1.37%, Bajaj Finserv fell 1.19% and ICICI Bank declined 0.93%.The Nifty Financial Services 25/50 index fell 1.08%, while Private Bank declined 1.14%. The Financial Services Ex-Bank index dropped 1.11% and the MidSmall Financial Services index fell 1.13%.Financial stocks have remained under pressure after the proposed changes to insurance commission structures by IRDAI triggered a sharp sell-off in insurance-linked businesses and financial companies last week.The concern is that changes to commission structures could affect the earnings and business models of companies linked to insurance distribution.FOREIGN INVESTORS CONTINUE TO SELLForeign investor selling is another major pressure point for Indian equities.Foreign institutional investors have offloaded nearly Rs 19,000 crore from Indian equities in September 2026, while their cumulative selling has crossed Rs 2.5 lakh crore so far in 2026, according to the figures provided.This comes at a time when global yields remain elevated and crude oil prices are high, making emerging-market equities more vulnerable to foreign fund outflows.The selling also comes after FPIs had turned buyers in July and August, according to Vijayakumar.The fall is not limited to the headline indices. The Nifty Smallcap 100 fell 1.08%, Midcap 100 declined 1.01% and Midcap 50 dropped 0.98%.Sectorally, Metal was down 1.33%, Realty 1.30%, PSU Bank 1.26%, Private Bank 1.14%, Financial Services Ex-Bank 1.11% and FMCG 1.06%.India VIX jumped 10.73%, showing that volatility has increased as investors assess the impact of higher oil prices and global macroeconomic risks.WHAT NEXT FOR THE MARKET?Vijayakumar said the current weakness reflects external pressures overpowering India's domestic fundamentals."The economy is resilient and corporate earnings are improving, but the market is steadily going down. This is a case of external headwinds overpowering domestic tailwinds," he said.He added that the valuation gap between large-caps and mid- and small-caps is unlikely to persist indefinitely, and that a reversion to the mean could happen when crude oil prices and US bond yields cool.For now, however, crude oil, US bond yields, financial stocks and FPI flows remain the key factors to watch as the market begins another week under pressure.(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)- Ends