India's benchmark equity indices, the Sensex and the Nifty 50, continued their downward trajectory for the fifth consecutive trading session on Friday, January 9. Persistent worries over foreign fund outflows, escalating geopolitical tensions, and a cautious stance ahead of the third-quarter corporate earnings season kept investors on the sidelines, shunning riskier assets.
A Steep Weekly Decline
The selling pressure was broad-based and intense. The 30-share Sensex plummeted nearly 500 points, or more than 0.50%, hitting an intraday low of 83,707.98. Mirroring this trend, the broader Nifty 50 index also dropped by more than half a per cent, touching an intraday low of 25,735.15. The pain was even more pronounced in the broader market, with both the BSE Midcap and Smallcap indices witnessing declines of over one per cent each.
Key Factors Driving the Sell-Off
Analysts point to a confluence of domestic and global factors behind the sustained weakness. The primary concern remains the continued selling by Foreign Portfolio Investors (FPIs), leading to a steady outflow of foreign capital from Indian equities. This has been exacerbated by renewed geopolitical uncertainties in various regions, prompting a global shift towards safer havens.
Furthermore, market participants are adopting a wait-and-watch approach as the December-quarter (Q3) earnings season is about to commence. Investors are keen to assess corporate performance and management commentary for future guidance before making fresh commitments.
Over 2% Loss in Just Five Days
The cumulative damage over this five-session losing streak has been significant. The Sensex has crashed over 2,000 points, translating to a loss of nearly 2.5%. Similarly, the Nifty 50 has declined by 2.3% during the same period. This sharp correction has eroded investor wealth and highlighted the heightened volatility and risk aversion prevailing in the market.
Disclaimer: This news article is for informational purposes only. The views and investment tips expressed are those of individual analysts. Readers are advised to consult certified financial experts before making any investment decisions, as market conditions are subject to rapid change.
