Explained: Why is the Stock Market Down Today?

After opening on a strong note, Indian benchmark indices again started stuttering. Nifty touched an intra-day low of 24,054, reporting a 2,223-point dip from its record-high of 26,277.

Here's a list of possible for today’s fall -

1. Stock market holiday in US

Mahesh M Ojha of Hensex Securities said, “The Indian stock market surged yesterday due to the rising US stock market. However, there is a lack of global cues due to the stock market holiday in the American market today. This could be the possible reason for profit-booking trigger in the Indian stock market despite a gap-up opening in the Opening Bell.”

2. FII selling

During November, markets witnessed heightened selling activity from FIIs, thereby painting a bleak picture about the near future. Moreover, buying among DIIs remained poor.

3. Union Budget 2024

Mahesh M Ojha said, “DIIs are waiting for the final cue from the Indian government after their victory in the Maharashtra Assembly Election. As the Union Budget 2024 is just two months away, they are in a Catch-22 situation, and hence they are non-participant in the current Indian stock market.”

4. US dollar Appreciation

Highlighting the key reasons for the surge in US dollar, Anshul Jain, Head of Research at Lakshimishree Investment and Securities, said, “Investors are switching money from the gold and equities to bond and forex market as the US dollar prices are continuously rising. This is also a reason for FIIs' continuous selling in the Indian stock market.”

5. Discounted geopolitical tension

Avinash Gorakshkar, Head of Research at Profitmart Securities said, “We witnessed a bounce back in the Indian stock market in the last two sessions after the news broke of a ceasefire in the Israel-Hezbollah war. However, the geopolitical trigger has been discounted, and the focus has once again shifted towards the Russia-Ukraine war. Hence, there is selling pressure in the Indian stock market.”