Markets swing, but close in the red
In early trade, the Sensex plunged over 1,050 points to hit an intraday low of 81,124, while the Nifty dropped more than 300 points to 24,919. A brief recovery lifted indices into positive territory, but renewed selling erased gains by afternoon.
By mid-session, the Sensex was trading around 289 points lower at 81,893, while the Nifty slipped nearly 100 points to hover close to 25,133. The previous session had already seen the steepest single-day fall in over eight months, adding to investor anxiety.
Rupee hits record low against US dollar
The sharp depreciation of the Indian rupee emerged as a key trigger for market weakness. The currency fell 31 paise to an all-time low of 91.28 against the US dollar, weighed down by strong dollar demand and risk-off sentiment globally.
Forex traders pointed to sustained foreign capital outflows and geopolitical uncertainty as major factors pressuring emerging market currencies.
Persistent FII selling weighs on sentiment
Foreign institutional investors continued to remain net sellers in the Indian equity market. On Tuesday alone, FIIs offloaded shares worth nearly ₹2,940 crore, marking the 11th straight session of net selling in January.
So far this month, FIIs have been net buyers on just one trading day, reflecting cautious global positioning amid concerns over interest rates, currency risks and geopolitical developments.
Weak global cues and US market sell-off
Asian markets traded lower, tracking sharp overnight losses on Wall Street. The Nasdaq Composite tumbled over 2 percent, while the S&P 500 and Dow Jones Industrial Average also ended significantly lower.
Renewed trade war concerns, following statements by US President Donald Trump on tariffs and geopolitical strategy, triggered a global sell-off. The uncertainty spilled over into Indian markets, adding to existing pressure.
Volatility rises as India VIX climbs
The India VIX, a key measure of market volatility, rose about 4 percent to 13.22. A rising VIX typically signals increased investor nervousness and a preference for reducing equity exposure.
Higher volatility also makes short-term trading more challenging, prompting traders to stay cautious amid unpredictable market swings.
Banking stocks, broader markets decline
Banking stocks bore the brunt of selling, with the Bank Nifty sliding up to 1.5 percent. Heavyweights such as ICICI Bank, HDFC Bank, State Bank of India and Punjab National Bank fell up to 2 percent.
The broader market also remained under pressure. Both the Nifty Midcap 100 and Smallcap 100 indices declined as risk appetite weakened. Market breadth was decisively negative, with declining stocks far outnumbering advances.
Technical outlook remains cautious
Market experts believe the near-term trend for the Nifty remains weak despite the possibility of intermittent pullbacks. Analysts caution that any recovery is unlikely to sustain unless key resistance levels are decisively crossed.
