Indian stock markets saw sharp profit booking on January 22, 2026, after an early rally driven by easing global trade tensions. The BSE Sensex dropped as much as 750 points from its day’s high, while the Nifty slipped towards the 25,200 level by late morning, trimming most of the opening gains.
Benchmarks opened strong, with Sensex jumping over 800 points and Nifty crossing 25,400 in early trade. This came after US President Donald Trump stepped back from tariff threats on European nations linked to Greenland talks, boosting global risk appetite and lifting Asian and US markets overnight.
By around 11:56 AM IST, Sensex stood at 82,021.97, up just 112 points or 0.14% from the previous close. Nifty was at 25,201.35, higher by about 44 points or 0.17%. Earlier highs saw Nifty touch around 25,430 levels before the pullback.
Key Reasons Behind the Trimmed Gains
Profit booking emerged as the main driver after three sessions of losses earlier in the week. Markets had fallen nearly 2% amid trade worries, foreign outflows, and mixed Q3 earnings. The sharp rebound triggered selling as investors booked profits near key resistance zones.
FII selling continued to add pressure. On January 21, foreign investors net sold Rs 1,788 crore in equities, even as domestic institutions bought Rs 4,520 crore. Persistent outflows have weighed on benchmarks, though DII support has limited deeper falls.
The rupee traded rangebound around 91.53-91.59 levels against the dollar, showing limited recovery after hitting a low of 91.7425 the previous day. Currency weakness reflected ongoing caution.
India VIX rose nearly 4% during the session, pointing to higher near-term volatility and fragile sentiment after the early optimism faded.
Sectoral and Stock Movements
Nifty Realty index emerged as the weakest sectoral performer, dragging on broader sentiment. Bank Nifty slipped 1% from its high but held modestly positive. Midcap index also corrected sharply from intraday peaks.
Heavyweights like HDFC Bank and ICICI Bank saw marginal declines, capping upside. Among losers, SBI Life Insurance fell nearly 2%, while Hindalco and Max Healthcare stayed under pressure. Some stocks like Eternal erased early gains.
Advances outnumbered declines early (around 2,532 to 1,140), but breadth weakened as the day progressed.
What Investors Should Watch
Today’s session shows how quickly sentiment can shift on global cues and local profit-taking. With Nifty facing resistance near 25,250-25,300 and support at 25,000, any break below the psychological level could lead to more downside.
Ongoing FII flows, rupee movement, and fresh Q3 results will remain in focus. Domestic buying has provided a cushion so far, but sustained foreign selling could keep pressure on.
For Mumbai-based investors and those tracking Dalal Street, this movement underlines the need to stay alert to both international developments—like US trade signals—and domestic earnings trends. A balanced approach, focusing on quality stocks with strong fundamentals, makes sense in this volatile phase. Keep tracking key levels and institutional activity for clearer direction ahead