Indian stock markets continued their losing streak, with the BSE Sensex and Nifty 50 extending losses for the fifth consecutive trading session. The sustained fall has raised concerns among retail and long-term investors, especially as benchmark indices have erased a significant portion of recent gains.
Market experts point to a combination of global and domestic factors behind the sharp decline.
What Happened in the Market Today
Both Sensex and Nifty opened weak and remained under pressure throughout the session. Selling was broad-based, with banking, IT, metals, and auto stocks facing heavy profit booking. Mid-cap and small-cap stocks also saw sharp cuts, indicating weak overall sentiment.
Volatility remained high as investors chose to reduce exposure amid uncertainty.
Global Cues Driving the Sell-Off
One of the biggest reasons behind the recent stock market crash is weak global sentiment. US markets have been under pressure due to concerns over sticky inflation and delayed interest rate cuts by the Federal Reserve.
Rising US bond yields have made equities less attractive, leading to foreign investors pulling money out of emerging markets like India. Asian markets have also shown weakness, adding to negative cues.
Foreign Investor Selling Continues
Foreign Institutional Investors (FIIs) have been consistent sellers over the past few sessions. Heavy FII outflows have put pressure on large-cap stocks, particularly in banking and IT sectors, which have higher foreign ownership.
This selling trend has played a major role in dragging down benchmark indices.
Domestic Factors Adding Pressure
On the domestic front, concerns around earnings growth have started to emerge. Market participants are cautious ahead of key quarterly results, especially from banking and IT companies.
Additionally, high valuations in certain pockets of the market have triggered profit booking after last year’s strong rally. Investors are becoming selective, leading to sharper corrections in overvalued stocks.
Sector-Wise Impact
Banking stocks were among the top losers, as worries over margin pressure and credit growth outlook weighed on sentiment. IT stocks declined due to weak global tech cues and cautious outlook from international clients.
Metal stocks slipped on fears of slowing global demand, while auto stocks faced pressure due to valuation concerns and rising input costs.
What Should Investors Do Now
Market experts advise investors to avoid panic selling during volatile phases. Long-term investors are being encouraged to focus on fundamentally strong companies and use corrections to gradually accumulate quality stocks.
Short-term traders, however, are advised to remain cautious, as further volatility cannot be ruled out until global cues stabilise.