Stock market crash: Sensex tumbles nearly 700 points; why is the Indian stock market falling today?
Indian stock market tumbles as Sensex drops 670 points, Nifty 50 by 188, driven by profit booking, global uncertainty, and a strong US dollar.
Stock market crash: Sensex tumbles nearly 700 points; why is the Indian stock market falling today?
On January 3, the Indian stock market dropped rapidly as the Sensex and Nifty 50 suffered significant losses. In early trading, the Sensex plunged around 670 points, whereas Nifty 50 fell 188 points. The dollar and investors booked profits after previous gains, leading to a broad sell-off among sectors in a market beset by concerns over corporate earnings.
The Sensex, starting at 80,072.99, dropped to 79,274.77, and the Nifty 50, which opened at 24,196.40, sank to 24,000.25. Stock market today is drag down - by massive selling in IT, banking, financial services, pharma, and realty.
Experts say there are many reasons why the Sensex crash happened. One of the main reasons for this is profit booking in large caps like HDFC Bank, ICICI Bank, Infosys, and TCS. Concern about high valuations, along with weak earnings in the global uncertainty phase, is prompting investors to lock in gains. Adding to the caution is the impending US Q3 earnings season and an expected swing higher in US policies.
The US dollar, which is now at a two-year high level compared to other currencies, is another issue affecting the Indian stock market. Foreign investors generally pull out their funds from emerging markets like India with a robust dollar. Foreign lavishing is not sustainable at the dollar index of 109.25 and the US 10-year bond yield of 4.56%.
Banking, financial, and IT heavyweights — which carry significant weight in the indices — struggled too. The Nifty IT index fell almost 2%, while the Nifty Bank and Financial Services index lost 1%. These sectors witnessed significant profit booking, dragging the indices further, despite expectations of robust performance for the December quarter.
The market will be volatile experts added that because of the upcoming events, including a policy meeting of the US Federal Reserve, Union Budget 2025 and a monetary policy decision by the RBI in February. Worries about the state of the global economy and possible changes in policy under the incoming US administration are also weighing on investors. These variables provide a more lucid explanation of why the Indian stock market is declining today.
